Ex-Post Project Evaluation 2017: Package I-5 (Tunisia, Morocco)

December 2018

JAPAN INTERNATIONAL COOPERATION AGENCY

EV JR 18-10

Octavia Japan, CO., LTD. Foundation for Advanced Studies on International Development (FASID）

(Joint Venture)

Disclaimer

This report compiles the result of the ex-post evaluations. These are conducted by external evaluators to ensure objectivity, and the views and recommendations herein do not necessarily reflect the official views and opinions of JICA. JICA is not responsible for the accuracy of the English translation, and the Japanese version shall prevail in the event of any inconsistency with the English version. Minor amendments may be made when the contents of this report is posted on JICA’s website.

Comments by JICA and/or the Counterpart Agencies may be added at the end of the evaluation report when the views held by them differ from those of the external evaluator. No part of this report may be copied or reprinted without the consent of JICA.

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Republic of Tunisia

FY2017 Ex-Post Evaluation of Japanese ODA Loan

“Private Investment Credit Project”

External Evaluator: Kenichi Inazawa, Octavia Japan Co., Ltd.

0. Summary

This project sought to develop a production base through the promotion of start-up

enterprises creation and expansion of existing enterprises by providing low interest rate and

medium- to long-term loans to small- and medium-sized enterprises (SMEs) in Tunisia1 in

order to contribute to the enhancement of the country’s industrial competitiveness and creation

of new employment opportunities. The Government of Tunisia’s 11th five-year plan (2007－

2011) and five-year development plan (2016 － 2020) indicate the need to strengthen

management bases through job creation and the provision of financing opportunities to SMEs.

Relevance of this project is high because there is a need for a lending program for SMEs

because SMEs face difficulty with borrowing funds from private-sector financial institutions

(commercial banks, etc.) due to insufficient collateral and because consistency with Japan’s

ODA policy is confirmed. As for efficiency, subsidiary loans were not implemented via eight

commercial banks accredited by the Ministry of Industry, Energy and SME (Ministere de

l'Industrie, de l'Energie et des Petites et Moyennes Entreprises, hereinafter “MIEPME”) mainly

due to the fact that SMEs' creditworthiness criteria by accredited commercial banks became

stricter due to the deterioration of economic conditions, and SMEs were less likely to receive

the loan. But the sub-loans were implemented only via the Tunisia’s SMEs lending bank

(Banque de Financement des Petites et Moyennes Entreprises, hereinafter “BFPME”). Thus, the

project cost was within the initial plan.The project period significantly exceeded the initial plan

because of delays in the borrowing procedures and screening of SMEs receiving loans from

BFPME due to the time consuming process within the Tunisian government in transferring loan

funds from account of subsidiary loans for SMEs via eight accredited commercial banks to

BFPME account, and because of the effects of the Jasmine Revolution (democratization

movement2). Therefore, the efficiency is fair. As for quantitative effects of effectiveness, the

loan repayment rate (subsidiary loans) is about half of the target. However, it was confirmed

through interviews with SMEs and BFPME that contributions were made to the enhancement of

1 Tunisia has a population of approximately 11.15 million (source: Statistics Tunisia; 2015 data). The country’sproductive sectors are agriculture, mining, trade, and tourism.2 High unemployment and the soaring cost of living led to people marching in demonstrations and unrest.Anti-government demonstrations expanded to every corner of the country and President of Tunisia at the time, ZineEl Abidine Ben Ali, was ousted and fled to Saudi Arabia.

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Project Site

Capital: Tunis

the country’s industrial competitiveness and creation of new employment opportunities.

Therefore, the effectiveness and impact of this project are fair. Taking into account that BFPME,

responsible for the operation and maintenance of this project, regularly conducts monitoring of

enterprises and the collection of receivables through its head office and regional branches, has

human resources with expertise, and has not seen a large spike in the ratio of non-performing

loans, there are no particular concerns in terms of the institutional, technical and financial

aspects. Thus, sustainability of the effects realized through this project is high.

In light of the above, the project is evaluated to be satisfactory.

1. Project Description

Project Location Print/offset, Packaging Manufacturing Enterprise(SME financed by this project)

1.1 Background

The Government of Tunisia sought to develop the manufacturing industry, with a focus on

textiles, agribusiness, and electrical components, and the services industry, with a focus on

tourism, transport, and IT services, etc., and aimed to develop SMEs, which form a local

industry for each of these fields, in order to diversify its industrial structure. In contrast, the

scale of individual enterprises was insignificant and capital amounts excessively small, while

the ratio of university graduates of the workforce tended to be low, resulting in SMEs that were

weak in terms of technology, financial standing, and management skills. Given that it tended to

rely on imports of capital goods, raw materials and components, etc., Tunisia lacked sufficient

international competitiveness as well. Using loans to SMEs for creating start-up enterprises and

expanding the size of existing SMEs was an urgent task, but Tunisia’s financial sector faced

non-performing loan issues since the 1980s and it was unable to fully accommodate the rampant

demand for capital exhibited by SMEs. The Government of Tunisia needed to accommodate

demand from domestic SMEs for medium- to long-term capital in order to enhance industrial

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competitiveness and create employment opportunities, while SMEs needed to increase the size

of their operations and improve financial standing.

1.2 Project Outline

The objective of this project is to develop a production base through the promotion of start-up

enterprises creation and expansion of existing enterprises by providing low interest rate and

medium- to long-term loans to small- and medium-sized enterprises (SMEs) in Tunisia thereby

contributing to enhance the country’s industrial competitiveness and creation of new

employment opportunities.

Loan Approved Amount/Disbursed Amount 6,277 million yen / 3,993 million yen

Exchange of Notes Date/Loan Agreement SigningDate

March 2007 / March 2007

Terms and Conditions Interest Rate: 0.9%Repayment Period: 15 years

(Grace Period: 5 years)Conditions for Procurement: General Untied

Borrower /Executing Agency

The Government of the Republic of Tunisia / Ministere del'Industrie, de l'Energie et des Petites et Moyennes Entreprises

(MIEPME)3 and Banque de Financement des Petites et MoyennesEntreprises (BFPME)

Project Completion January 2016Main Contractors(Over 1 billion yen)

－

Main Consultants(Over 100 million yen)

－

Related Studies(Feasibility Studies, etc.)

Special Assistance for Project Formation (SAPROF) (January2006)Special Assistance for Project Implementation (SAPI) (March2008)

Related Projects 【Technical Cooperation】“The Study on the Master Plan for Quality/ProductivityImprovement in the Republic of Tunisia” (2006-2008, Technicalcooperation on development plan survey type)“Project on Quality/Productivity Improvement(Q/PI)”(2009-2013)

【Other International Organizations, Donors’ Cooperation】“The Economic Competitiveness Adjustment Loan for Tunisia”(Since 1999, World Bank)“Competitiveness Support Programme” (Since 1999, African

3 The name of the organization was changed in September 2017. At the time of the project’s appraisal, the name wasMinistry of Industry, Energy and SMEs (MIEPME).

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Development Bank)“Support for SME Innovation, Standardization/QualityImprovement, Intellectual Property Rights” (The period isunknown, the European Union)“Support for New Establishment of SMEs and Modernization ofBusiness Expansion & Facilities (Since 1998, the EuropeanInvestment Bank)”“Support for Improving the Financial Structure of PMNRegistered Companies (Two-Step Loan (TSL)) (1996, AgenceFrançaise de Développement)”“Supporting for Improving the Financial Structure of PMNRegistered Companies” (Two-Step Loan (TSL)) (2000, KfWBankengruppe), “Capacity Building for PMN Bureau” (DeutsheGeselleschaft fuur Internationale Zusammenarbeit)“Provision of Tied Loan” (The period in unknown, Government ofItaly and Spain)

2. Outline of the Evaluation Study

2.1 External Evaluator

Kenichi Inazawa, Octavia Japan Co., Ltd.

2.2 Duration of Evaluation Study

This ex-post evaluation study was conducted with the following schedule.

Duration of the Study: September 2017 - December 2018

Duration of the Field Study: January 18 - February 2, 2018 and April 14-20, 2018

2.3 Constraints during the Evaluation Study

With regard to this evaluation, the external evaluator conducted interview surveys (qualitative

interview surveys) on SMEs that received loans only in the capital Tunis, for the sake of

security reasons. Then, the analysis and judgment was conducted.

3. Results of the Evaluation (Overall Rating: B4)

3.1 Relevance (Rating: ③5)

3.1.1 Consistency with the Development Plan of Tunisia

At the time of the project’s appraisal, the Government of Tunisia formulated its 10th

five-year plan (2002－2006). The plan stated the acceleration of industrial promotion, increase

of investment, creation of employment, improvement of international competitiveness, and

4 A: Highly satisfactory, B: Satisfactory, C: Partially satisfactory, D: Unsatisfactory5 ③: High, ②: Fair, ①: Low

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enhancement of private-sector productivity and efficiency, among others, as main targets. In

addition, through the 11th five-year plan (2007 － 2011), the government positioned

enhancement of SMEs competitiveness as an important field.

At the time of the ex-post evaluation, the Government of Tunisia has formulated the

five-year development plan (2016－2020), with one of the objectives building a diversified

economic structure grounded in the high potential of exports and job creation. This same plan

also aims to create 400,000 jobs and lower the unemployment rate from 15%6 to 12% by the

year 2020. In addition, the plan advocates the reinforcement of management base and

rectification of the imbalance of financing opportunities through banking information system

reforms and opportunities for the provision of financing to SMEs as important goals for the

finance and banking sector.

In view of the above, through at the time of project appraisal and at the time of ex-post

evaluation, Tunisia places importance on creating jobs and strengthening management base by

providing funds for SMEs. Therefore, it is recognized that this project has consistency with

policies and measures of the government both at the time of project appraisal and at the time of

ex-post evaluation.

3.1.2 Consistency with the Development Needs of Tunisia

At the time of the project’s appraisal, Tunisia’s financial sector, in particular commercial

banks in the country, lacked know-how for determining credit exposure and knowledge of each

industry sector. As a result, the rampant needs for capital exhibited by SMEs were largely unmet.

In other words, despite the need to develop industry, Tunisia’s medium- to long-term finance

markets were not fully developed, causing a bottleneck that inhibited the country’s economic

growth. Also, most Tunisian entrepreneurs faced difficulty in obtaining loans from commercial

banks because of insufficient collateral, which stood in the way of start-ups developing into

promising enterprises. Tunisia had high demand for enhancing the finances and production base

of SMEs that can be the receiving end of youth employment through medium- to long-term

loans. As a result, the country was faced with the need to develop SMEs that will become the

backbone of its economy. In such circumstances, Tunisia was making progress with the

development of a loan assistance framework, including establishing BFPME in 20057, which

6 2014 data (Source: document of the “five-year development plan”)7 Prior to the start of this project, BFPME was mainly supporting for co-finance with commercial banks for start-upenterprises. From the establishment to August 2006, BFPME was implementing 145 medium- and long-term loans ormore. (Source: JICA document). Meanwhile, besides support for the start-up enterprises, BFPME was exploring

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cites business creation support for SMEs as its management philosophy.

At the time of the ex-post evaluation, the Government of Tunisia has been implementing an

assistance program for SMEs focused on provision of technical support, capacity building, and

an increase in provision of loans. Beginning in 2016, loans totaling 100 million TND8 were

granted to around 300 SMEs in the country, under a three-year plan. Loans granted to SMEs in

Tunisia have been implemented by MIEPME with the involvement of BFPME. According to

both organizations, SMEs’ collateral was insufficient, similar to at the time of the project’s

appraisal, and it was difficult to obtain loans from private-sector financial intuitions

(commercial banks, etc.). The background to the implementation of this program is the above

mentioned situation which has become bottleneck for reinforcing enterprises’ growth and

strengthening financial strength and fostering industry9 Also, at the time of the ex-post

evaluation, there is a possibility for the future expansion of the program given the continuing

strong needs for loans.

Reference Information: Table 1 is reference data that presents changes in the number of

enterprises in Tunisia from 2006, prior to the start of the project, to 2010, after the start of the

project. Many enterprises in Tunisia have a small workforce and are small in scale. There are

large numbers of micro and new businesses established. The table indicates this trend has not

changed since before the start of this project. In other words, there will continue to be strong

appetite in Tunisia for starting businesses and as a result, strong needs for loan financing to

secure stable cash flow is predicted.

opportunities to support for the business expansion.8 Tunisian Dinar9 European Investment Bank (2015) Neighbourhood SME financing: Tunisia. European Investment Bank.http://www.eib.org/attachments/efs/economic_report_neighbourhood_sme_financing_tunisia_en.pdf, accessed onMarch 16, 2018)This report examines financing for SMEs in Tunisia and was jointly compiled by the European Investment Bank(EIB), the European Bank for Reconstruction and Development (EBRD), and the World Bank. According to thisreport, more than 60% of SMEs depend on their own funds for capital to fund their business activities, and only 10%of SMEs borrow money using loans. SMEs have difficulty taking out loans even if they want to. Specifically, SMEslack sufficient collateral and they are facing with high borrowing rates. On the contrary, SMEs are facing with thepressing need of business development and expansion by increasing borrowings continuously from financialinstitutions.

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(Reference) Table 1: Changes in the Number of Enterprises(Unit: number)

Size ofworkforce

2006 2010 2011 2012 2013

0 434,848 516,794 523,071 546,464 574,6501-2 39,782 46,294 45,139 44,402 44,0813-5 13,673 15,824 15,661 16,485 17,1716-9 5,497 6,646 6,344 6,609 6,806

10-19 4,365 5,113 5,064 5,136 5,02920-49 3,022 3,481 3,467 3,558 3,47550-99 1,409 1,642 1,627 1,615 1,573

100-199 938 977 1,040 1,029 960200 ormore10

750 826 809 804 779

Total 504,284 597,597 602,222 626,102 654,524Source: Tunisia’s Foreign Investment Promotion Agency (FIPA)

In view of the above, consistency with the development needs is recognized both at the time

of appraisal and at the time of ex-post evaluation for this project aiming to strengthen corporate

growth / financial strength and support industry development.

3.1.3 Consistency with Japan’s ODA Policy

The Government of Japan formulated the Country Assistance Program for the Republic of

Tunisia in October 2002. The program cited 1) assistance for enhancing the level of industry, 2)

assistance for development and management of water resources, and 3) assistance for

environmental initiatives, as important areas and tasks to be addressed with priority, taking into

account the main development challenges faced by Tunisia. In addition, JICA formulated the

Medium-Term Strategy for Overseas Economic Cooperation Operations in April 2005, which

considers “a foundation for sustainable growth” as an important area. Furthermore, in fiscal

2006, JICA prepared the Country Assistance Strategy for the Republic of Tunisia, which

advocated the importance of assistance for “strengthening of the economy and acceleration of

speed of growth.”

This project contributes to the formation of social foundation in Tunisia and the

development of SMEs, which occupy a major part of the local industry. The project has a strong

consistency with the important fields and issues of Japan’s country assistance program, and

JICA’s policy. Consequently, it is said that this project was considered to have consistency with

Japan’s ODA policy.

10 From this table, it turns out that there are only about 0.1% of enterprises with more than 200 employees.

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Base on the above, the implementation of the project has been highly relevant to the

Tunisia’s development plan and development needs, as well as Japan’s ODA policy. Therefore,

its relevance is high.

3.2 Efficiency (Rating: ②)

3.2.1 Project Outputs

Table 2 shows the output plan of this project and actual results at the time of ex-post

evaluation.

Table 2: Output Plan of This Project and Actual Results at the Time of Ex-post EvaluationPlan (Project appraisal: 2007) Actual Results

(At the time of ex-post evaluation: 2017-2018)①Mid- and long-term Two-Step Loan (TSL)to SMEs (subsidiary loans for supportingmainly start-up enterprises via BFPME andsubsidiary loans for supporting businessexpansion of SMEs registered withUpgrading Program11 (Program de Mise àNiveau; hereinafter "PMN") via accredited 8commercial banks serving as participatingfinancial institutions; hereinafter “PFI”)

(a) Lending covenants of accreditedcommercial banks(i) Legal status and form about end users・Commercially registered enterprises inTunisia (Foreign capital not exceeding 50%of the total capital of the enterprise)(ii) Size of end users・PMN registered enterprises・Net fixed assets ranging between 80,000TND and 4 million TND before financing.・Capital ratio after new investment by thisproject is 30% or more.・Business history is 2 years or more.・Number of employees is less than 300people.・Sound financial condition (no history oflong-term default on debt in the past)(iii) Eligible sector・Manufacturing and service industry(iv) Eligible business

①Mid- and long-term Two-Step Loan (TSL) toSMEs(a) Subsidiary loans for SMEs via eightaccredited commercial banks were notimplemented.(b) Subsidiary loans for start-up enterprises andbusiness extension via BFPME wereimplemented.

【Lending covenants (Actual)】(i) Legal status and form about end users・Commercially registered enterprises inTunisia (Foreign capital not exceeding 50% ofthe total capital of the enterprise)(ii) Size of end users・The amount of new investment with thesubsidiary loan provided under this project isfrom 100,000 TND to 10 million TND(start-up enterprises and business expansion)・Capital ratio is 30% or more.・Number of employees is less than 300 people.・Sound financial condition（No history oflong-term default in the past, and there is littlepossibility, etc.）(iii) Eligible sectorMainly primary industry such as agricultureand agriculture related sector, manufacturingindustry, service industry (Except real estateand tourism sector)(iv) Eligible business

11 It is a policy of the Tunisian government aiming to strengthen the competitiveness of SMEs in the manufacturingindustry and responding to free trade areas in the European and Mediterranean regions. It was being implementedsince 1995.

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・Material investment: equipment purchase /installation, equipment design device,computer-aided design equipment (CAD),computer-aided manufacturing equipment(CAM), laboratory equipment / controlequipment, transportation equipment,handling equipment, etc.・Non-material investment: technical support,software introduction, certification system /quality system, vocational training, etc・Working capital: raw material inventory,parts, other essentials, etcNote) Administrative expenses, taxes, tariffs,acquisition of land or land use rights, andcompensation are not covered by loans.(v) Maximum loan amount (at the beginning)・Maximum amount per Subsidiary Loan is 1million TND (in case of providing subsidiaryloans to working capital, it is within 20% ofthe subproject cost.)(vi) Approval authorization of subsidiary loan・The creditworthiness assessment of targetSMEs is conducted by the accreditedcommercial banks. The central bank onlyconfirms the formal requirements.(vii) Currency・TND or JPY(viii) Interest rate・In case of subleasing in TND:Approximately 7.9% (interest rate on ODALoan 0.9% + foreign exchange risk cover fee4% of Ministry of Finance+ PFI’s spread upto 3% + cost of consulting services)・In case of subleasing in JPY: Approximately3.9% (interest rate on ODA Loan 0.9%+PFI’s spread up to 3% + cost of consultingservices)・Consulting service’s expenses of this projectwill be borne by the end user.・If fluctuations in foreign exchange rates ormarket interest rates are large after the start ofloans, it is possible to change the interest rateafter consultation between JICA and theTunisian government.(ix) Repayment period and grace period

・7 to 12 years (including a grace period of upto 3 years)(x) Proportion of Fund/Loan Burden・In this project, the end user will bear 30% ormore of the subproject cost, and theremaining amount will be covered by

・Capital investment: Construction, expansionand modernization cost related to new /existing equipment / facilities・Research and development investment:Expenses related to R & D and innovation(including vocational training leading toimprovement and strengthening of productcompetitiveness)・Working capital: raw materials, final productinventory, spare parts etc.Note) Administrative expenses, taxes, tariffs,acquisition of land or land use rights, andcompensation are not covered by loans.

(v) Maximum loan amount・In case of working capital, it is within 20% ofsubproject cost.(vi) Approval authorization of Subsidiary Loan・The creditworthiness assessment of targetSMEs is conducted by BFPME. The centralbank only confirms the formal requirements.(vii) CurrencyTND(viii) Interest rate・In case of subleasing in TND: 7.125%(average) (details: interest rate on ODA Loan0.9% + foreign exchange risk cover fee3.225% of Ministry of Finance+ cost ofBFPME’s commission 3%)

【Loan Results】・Number of loans:Start-up enterprises→ 241 (79%), businessexpansion of existing enterprises→ 64 (21%),Total: 305・Total loan amount: Approximately 65.77million TND・Average loan period: 7 to 10 years (includinga grace period of up to 2 years)

・(Reference information) Sector classificationof loan borrowers (detailed) and percentage ofloan:Sewing 24%, agriculture related business 20%,agriculture 12%, service industry 10%,chemical and petroleum productsmanufacturing 10%,construction/machinery/ceramic/glassmanufacturing industry 7%, diversifiedbusiness manufacturing 5%, machinerymanufacturing industry 4%, leather goods/shoemanufacturing industry 3%, wood processing

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financing from the accredited commercialbank (ODA loan will finance 100% of theaccredited commercial bank loan). Collateralwill be drawn up at the discretion of theaccredited commercial bank, and the TunisianGuarantee Company (SOTUGAR) willguarantee the collateral as necessary.(xi) Credit risk・End user's credit risk is borne by theaccredited commercial bank.(xii) Environmental and social clearance・Subprojects are limited to those withminimal or no undesirable effects on theenvironment.

(b) Lending covenants of BFPME(i) Legal status and form about end usersCommercially registered enterprises inTunisia (Foreign capital not exceeding 50%of the total capital of the enterprise)(ii) Size of end users (at the beginning)・Business expansion: The amount of newinvestment with the subsidiary loan providedunder this project and fixed asset before newinvestment is from 80,000 TND to 4 millionTND.・Start-up enterprises: The amount of newinvestment with the subsidiary loan providedunder this project ranges between 80,000TND and 4 million TND.・Capital ratio is 30% or more.・Number of employees is less than 300people.・Sound financial condition (no history oflong-term default on debt in the past)(iii) Eligible sector・Manufacturing and service industry (Exceptreal estate and tourism sector )(iv) Eligible business・Capital investment: Construction, expansionand modernization costs related to new /existing equipment / facilities and relatedconsultant fee・Research and development investment:Expenses related to R & D and innovation(including vocational training leading toimprovement and strengthening of productcompetitiveness)・Working capital: raw materials and finalproduct inventory, spare parts etc.Note) Administrative expenses, taxes, tariffs,

industry 2%, information industry 1%, electricand electrical industry 1%, energy industry 1%

・(Reference information) Area of loanborrower: 22% in the Tunis Metropolitan Area,18% in the Northeast, 17% in the Middle East,12% in the Midwest, 11% in the Northwest,11% in the South East, 10%, in the South West,10%

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acquisition of land or land use rights, andcompensation are not covered by loans.(v) Maximum loan amount (at the beginning)・Maximum amount per Subsidiary Loan is 1million TND (in case of providing subsidiaryloans to working capital, it is within 10% ofthe subproject cost.)(vi) Approval authorization of SubsidiaryLoan・The creditworthiness assessment of targetSMEs is conducted by BFPME. The centralbank only confirms the formal requirements.(vii) Currency・TND or JPY(viii) Interest rate・In case of subleasing in TND:Approximately 7.9% (interest rate on ODALoan 0.9% + foreign exchange risk cover fee4% of Ministry of Finance+ BFPME’s spreadup to 3% + cost of consulting services)(ix) Repayment period and grace period

・2 to 10 years (including a grace period of upto 2 years)② Consulting Services (It is planned toemploy consultant who supports for projectimplementation and supervision to theexecuting agency and the steering committeeestablished for this project, supports forholding of the steering committee meeting,supports for project progress report / externalaudit to the executing agency and JICA, andconducts monitoring and advice onmanagement for end user.)

②Consulting ServicesThe consulting services were not carried out12.

Source: JICA documents (at the time of project appraisal), answers on questionnaire and JICA documents (at thetime of ex-post evaluation)

▼The following is the analysis and review on the plan and actual results (Table 2) related to the

output of this project:

①Mid- and long-term Two-Step Loan (TSL) to SMEs

In this project, (b) “subsidiary loans for start-up enterprises and business expansion via

BFPME,” were implemented, but (a) “subsidiary loans for SMEs via the eight accredited

commercial banks” were not implemented. According to interviews with BFPME, the Ministry

of Industry (formerly, MIEPME), the Ministry of Development, Investment and International

12 In relation to the fact that subsidiary loan for SMEs via eight accredited commercial banks was not implemented,the Steering Committee, which was supposed to be established for this project as a TOR of consulting services at thetime of project appraisal, was not organized and held.

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Cooperation, and JICA officials, the background and reason for this is outlined below.

First, market interest rates fluctuated violently in Tunisia between 2008 and 2009, which

caused major fluctuations in profit and loss for the period for private-sector financial institutions,

obtained by subtracting funding costs from fund management income. Funding costs in most

cases exceeded fund management income, placing pressure on the profits and capital adequacy

of private-sector financial institutions, and as a result, liquidity and solvency declined.

Following the Jasmine Revolution (democratization movement) from 2010 to 2011, Tunisia’s

economy weakened and SMEs faced operating difficulties. Given this situation, the accredited

commercial banks (eight banks) selected for this project in actuality tightened credit screening

standards for SME borrowers in order to avoid difficulty collecting loan receivables after the

start of the project. As one example, banks made a policy that required collateral when eligible

SMEs took out loans, but instead of setting collateral through a guarantee company, there were

many cases where banks required physical assets, such as land, homes, depreciable assets, or

vehicles, etc. In other words, accredited commercial banks carried out creditworthiness

screenings of SMEs under this project in a much stricter manner, making borrowing conditions

more difficult for SMEs.

On the other hand, JICA officials commented, “As a yen loan project to Tunisia, this

project was the first financial intermediary loan. Although we had confirmed the high demand

for capital among SMEs, there were no precedents in terms of other loan programs in Tunisia

before this, so we incorporated risk mitigation measures by preparing options for the lending

route via the central bank. For this reason, two lending routes were considered and established.”

In actuality, only (b) subsidiary loans of BFPME were implemented. Although the project was

reduced in size, the project itself continued and exhibited a certain degree of effects (as

explained in 3.3 Effectiveness and Impact).

Since there was little progress with (a) “subsidiary loans for SMEs via the eight accredited

commercial banks”, in April 2013 the Government of Tunisia and JICA agreed to simplify the

lending route and to assist start-up enterprises and business expansion for SMEs through

BFPME only. Lending covenants, too, were modified somewhat. As one example, the interest

rate was lowered (initial plan: basically 7.9% to actual of 7.125% on average), loan eligibility,

too, was expanded from less than 10% of subsidiary project cost in the case of operating capital

to less than 20%, while the cap on new investment was lifted from 1 million TND to 10 million

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TND13. In other words, these changes helped to develop an environment easier for eligible

SMEs to obtain loans, and the number of loans and value of loans under BFPME’s subsidiary

loans satisfied the initial plan.

②Consulting Services

Under the initial plan, MIEPME was supposed to be responsible for selection and hiring of

consulting services, and these services were supposed to cover supervision assistance and

monitoring for the project as a whole. However, as discussed above, this part of the plan was not

implemented because (a) “subsidiary loans for SMEs via the eight accredited commercial banks”

were not implemented14.

3.2.2 Project Inputs

3.2.2.1 Project Cost

The plan at the time of the project’s appraisal called for a total project cost of 6,591 million

yen (of this, 6,277 million yen was to be covered by yen loans). In contrast, the actual total

project cost was 3,993 million (of this, 3,993 million yen was covered by yen loans), indicating

the cost was within the plan (64% versus the plan)15.

The reason for this is because, as explained in 3.2.1 Outputs, subsidiary loans for SMEs

through the eight accredited commercial banks and consulting services were not implemented.

3.2.2.2 Project Period

At the time of the project’s appraisal, the project period was planned for the four years and

ten months (58 months) from March 2007 to December 2011. In actuality, the project period

13 With regards to collateral for loans, in the case of BFPME’s subsidiary loans, BFPME can have a total of 60% ofthe loan guaranteed by the Tunisian Guarantee Company (SOTUGAR) by paying a fee of 2.6% of the loan amount toSOTUGAR (In other words, 2.6% in fees will be paid and transferred from BFPME to SOTUGAR directly. If a SMEhas a loan with another bank, BFPME shares the guarantee with the other bank). SMEs are notified of the 2.6% fee atthe time of calculating the subsidiary project cost, but this will be converted to part of the loan repayment at a laterdate. Using this mechanism, SMEs do not have to provide physical assets as collateral.14 Although BFPME continued to request the assistance of consulting services, the request was not accepted byMIEPME. BFPME advanced its lending program independently. It is believed that this decision was made becauseBFPME is primarily a financial institution dedicated to financing support for SMEs and BFPME would not faceparticularly large obstacles since it had experience with monitoring as well as advising and instructing managementbefore the start of this project.15 To supplement, the actual total project cost of 3,993 million yen does not include general administrative expenses.Because BFPME does not know the general administrative expenses, the amount of general administrative expenses(314 million yen) subtracted from the total project cost at the time of the project’s appraisal (6,591 million yen), or6,277 million yen, is compared with the actual total project cost of 3,993 million yen. As a result, it is approximately64% versus the plan. At the time of the project appraisal, it was assumed that 3,077 million yen would be allocated tosubsidiary loans for SMEs via eight accredited commercial banks, and 3,076 million yen would be allocated tosubsidiary loans supporting for start-up enterprises and expansion of business via BFPME.

14

was (107 months) from March 2007 to January 2016, greatly exceeding the plan (184% versus

the plan). Table 3 shows the initial plan and actual periods of each of the project’s components.

The major causes of this delay are cited as: the time consuming process (more than two years)

within the Tunisian government in transferring loan funds from account of subsidiary loans for

SMEs via the eight accredited commercial banks to BFPME account,, which affected the

borrowing procedures and screening of SMEs receiving the subsidiary loans from BFPME, and

because of procedural delays within the Tunisian government due to the Jasmine Revolution

(democratization movement) that occurred from 2010 to 2011.

Table 3: Initial Plan and Actual Results of the Project Period

Initial Plan Actual Results

(The Whole Project) March 2007 － December 2011(58 months)

March 2007 － January2016 (107 months)

Each Project Component

1) Selection of Consultants March 2007－December 2007 Not selected

2) Two-Step Loan (TSL) forSMEs January 2008－December 2011

April 2009－January 2016(Only subsidiary loan of

BFPME)3) Consulting Services January 2008－December 2011 Not implementedSource: Documents provided by JICA, answers on questionnaire

3.2.3 Results of Calculations for Internal Rates of Return (Reference only)

This project provided development finance for SMEs in Tunisia through intermediary

financial institutions, and subsidiary projects could not be identified beforehand; and as a result,

at the time of the project’s appraisal the Economic Internal Rate of Return (EIRR) and Financial

Internal Rate of Return (FIRR) could not be calculated. Therefore, both of these indicators were

not re-calculated at the time of the ex-post evaluation.

In light of the above, although the project cost was within the plan, the project period

exceeded the plan. Therefore, efficiency of the project is fair.

15

3.3 Effectiveness and Impacts16 (Rating: ②)

3.3.1 Effectiveness

3.3.1.1 Quantitative Effects (Operation and Effect Indicators)

1) Operation and Effect Indicators

As discussed above, under this project only BFPME’s subsidiary loans were implemented,

while subsidiary loans for SMEs through the eight accredited commercial banks were not. Table

4 presents the targets and actual results of the project’s quantitative effects.

Table 4: Operation and Effect Indicators (target and actual results)

IndicatorTarget (2013) Actual results after the

completion(Two years after the

completion)(One year after the

completion: as of end of 2016)1) Subsidiary Loan RepaymentRate of This Project (%)

More than 90% 45%*Note 1

2) Rate of Increase in Sales(SMEs) (% of increase)

Will be set at the time ofproject commencement

(Reference: positive)*Note 2

75%(Average value of SMEs

that received loans)3) Rate of Increase in OperatingIncome (SMEs) (% of increase)

Will be set at the time ofproject commencement

(Reference: positive)*Note 2

-1%(Average value of SMEs

that received loans)4) Number of Jobs (SMEs) Will be set at the time of

project commencement(Reference: 5,219)*Note 2

7,666(Total value of SMEs that

received loans)Source: Documents provided by JICA, answers on questionnaireNote 1: The repayment rate of subsidiary loans alone was around 45% at the end of 2017. For all others, only resultsat the end of 2016 were confirmed (most recent data).Note 2: No target was set at the time of the project’s appraisal. However, it was revealed through interviews thatMIEPME and BFPME set their own individual targets/benchmarks around the start of the project. However, detailedinformation could not be obtained as to what basis was used for these targets/benchmarks. Therefore, they will behandled as reference numbers.

At the start of the project, four quantitative effect indicators were set as per Table 4. However,

only the target value of 1) Subsidiary loan repayment rate was established. Target value of 2)

Rate of increase in sales, 3) Rate of increase in operating income, and 4) Number of jobs were

to be set at the start of the project, but in actuality they were not established. On the other hand,

it was confirmed through interviews that BFPME independently set targets/benchmarks of 2), 3)

and 4) around the start of the project.

The 1) Subsidiary loan repayment rate is stuck around half of the target (45%). BFPME has

commented, “The repayment rate of BFPME’s other loan programs outside of this project

16 Sub-rating for Effectiveness is to be put with consideration of Impacts.

16

remains around 45% during three to four years after loan completion. A similar trend is seen

with other loan programs outside of this project, and for some time after the loan is

implemented the repayment rate remains low. If sales increase and subsequently operating

income increases, it has a positive effect on the repayment rate.” In reality, many SMEs that

receive loans see sales gradually increase after loan implementation, but they tend to have little

room for repayments shortly after the loan is implemented. Even in qualitative interviews with

SMEs in 3.3.2.1 Intended Impact, it was confirmed that while sales increase after loan

implementation, operating income does not. As Table 4 indicates, of all the enterprises that

received loans, the 2) Rate of increase in sales was 75%, but the 3) Rate of increase in operating

income was negative 1%, which tells of this reality. In addition, (1) many SMEs tend to invest

in new facilities and employment, maintain and reinforce their management base, and expand

the size of their business further, even when profits are generated from the business, and (2) the

Jasmine Revolution (democratization movement) that occurred in Tunisia from 2010 to 2011

negatively affected the economy, which is still recovering. As a result, it is believed that these

two factors impact the repayment rate.

As for 4) Number of jobs (SMEs), the figure exceeds the individually set target of 5,219 jobs.

As discussed above, SMEs tend to invest funds in employment of human resources, and this

result can be seen as reflecting this trend. It is presumed that there is high possibility that

employment was generated even more than initially expected.

3.3.1.2 Qualitative Effects

・Strengthening the Development of Production Base for SMEs

In this survey, it was confirmed through interviews17 with SMEs that received loans (via

BFPME) under the project, that this project basically contributes to providing opportunities for

loan financing to SMEs and to strengthening of the country’s production base. The following

presents examples of interview results.

17 Key informant interviews were conducted targeting representatives, executives or managers of enterprises in theTunis capital region (total of eight individuals of eight enterprises) that received loans (via BFPME) under thisproject. Obtaining a list of SMEs in the capital region (69 enterprises in total) from BFPME, the target SMEs wereselected based on the following points: (1) balance between four start-up enterprises and four expanding SMEs; (2)no sector bias; (3) no bias in terms of loan amount and capital of the companies (confirmed that there was no bias interms of loan amount); and (4) located in an area without public safety concerns.

17

[Enterprise A: designs and manufactures men’s shirts] (Sewing / Start-up Enterprise:

Photo 1)

The reason we received a loan (via BFPME) under this project is because we did not have to

provide physical collateral (physical collateral was necessary to obtain a loan from a

commercial bank). After receiving the loan from BFPME, our sales increased 10 to 15%

annually. Operating income is increasing at about the same rate, but any gains are offset in

order to invest in facilities and employment. In particular, it costs money for machine

purchases and raw materials, which makes it difficult to repay the loan. Initially, we started

with four employees, but now we employ 23, and this number is gradually increasing.

[Enterprise B: manufactures plastics] (Manufacturing / Business Expansion: Photo 2)

Since receiving the loan (via BFPME) under this project, our production volume has more

than doubled and sales have nearly tripled. At the same time, new investments will be made

in purchasing manufacturing machines. We also want to increase our workforce, so there is

little room financially. Most of our daytime employees are women, because they are more

dexterous and are good at finely detailed work. Men mostly work night shifts. This ensures

a division of duties. The average age of employees is 28 to 30 years old. All staff are

satisfied with their workplace and jobs. This year we hope to expand our customers to

include companies in neighboring Algeria and France.

[Enterprise C: manufactures construction materials] (Manufacturing / Start-up

Enterprise: Photo 3)

Our company was founded in 2013 and began full-fledged manufacturing in July 2015. We

received a loan (via BFPME) under this project in 2014. BFPME’s loan screening process is

not that severe. I believe it offers better interest rates than other banks. Soon after

repayments began, we faced a cash flow issue and tended to be delinquent on repayments.

We consulted with our account manager at BFPME and were able to change the loan’s

repayment term. Currently, we are repaying the loan twice a year (in March and September)

on time. BFPME communicated with us regularly even during the loan repayment deferral

period. For example, when we exhibited products at an industrial fair in a regional city, they

came to see our booth. Our sales have nearly doubled over the past two years. However,

operating income remains unchanged. We are investing in machine tools, etc., so we have

yet to generate profits.

18

In light of the above comments, it appears that SMEs that utilized loans (via BFPME) under

this project are increasing sales and employment. Although operating income has yet to increase

or time is needed until it will increase, it can be presumed that in general this project is

underpinning the expansion of business size and reinforcement of production base development

through loans to SMEs in Tunisia.

Consequently, in terms of BFPME’s subsidiary loans, it is judged that, within the determined

loan covenants and environment surrounding SMEs, targets have been fairly achieved taking

into account the results presented in Table 4 and the qualitative results discussed in the above.

3.3.2 Impacts

3.3.2.1 Intended Impacts

・Contribution to Strengthen Tunisia's Industrial Competitiveness and Creation of New Job

Opportunities

As figures 1 to 5 indicate, economic statistics were obtained and used to analyze Tunisia’s

Photo 1: Designs and ManufacturesMen’s Shirts (Start-up enterprise)

Photo 2: Manufactures Plastics(Business expansion)

Photo 3: Manufactures Construction Materials(Start-up enterprise)

19

socio-economic trends after the start of this project. Depending on the year, changes can be seen

in real GDP trends (Figure 1), foreign direct investment trends (Figure 2), and export value

trends (Figure 3). It is presumed that these changes were affected by the Global Financial Crisis

from 2008 to 2009, the Jasmine Revolution (democratization movement) from 2010 to 2011,

and political and social unrest since 2015, and it is believed that the management state of SMEs

has been impacted, too. In contrast, when examined over a five to 10 year span, trends in the

inflation rate (Figure 4) and unemployment rate (Figure 5) have been improving since 2012.

There have been no signs of economic recovery after the revolution, but it is presumed that the

cost of living and employment are gradually returning to more stable trends. This concludes the

description of Tunisia’s macroeconomic situation.

In this survey, interviews18 with BFPME’s senior managers were conducted, which yielded

the following comments and opinions: “With regard to Table 4 Rate of increase in sales (75%),

this project outperformed other loan programs run by BFPME, but there was not a huge

difference. In either case, political, economic and social unrest in 2010 to 2011 and thereafter

have made the situation particularly difficult in terms of the economy, but enterprises are putting

up a good fight. The fact that SMEs have been able to increase sales should be praised purely

onto itself,” “As for Table 4 Rate of increase in operating income (-1%), there are few instances

where operating income increases immediately after the loan, regardless of a start-up enterprise

or expansion of an existing SMEs. In some respects, this is unavoidable for SMEs with a weak

financial base. This also depends on the economy. The loan repayment rate will increase once

operating income increases in several years following continued gains in sales,” “In the sense of

developing young entrepreneurs, this project’s loans for start-up enterprises was meaningful.

This is because even if they start up a business, they would be tripped up in terms of securing

the necessary funds,” “As for the number of jobs, a relatively large number of SMEs have been

increasing their workforce. During company visits, we have seen firsthand that the number of

young people employed at these companies is particularly on the rise. Stable employment

generates stable social order and incomes,” and “It is nice to see sectors exporting products to

other countries, such as the sewn garments business, increasing sales after utilizing loans from

BFPME. However, we cannot really say for sure at the present time whether this project helped

to reinforce Tunisia’s international competitiveness. I feel this will happen in the future.”

18 Key informant interviews for all four staff (three males and one female) working at the departments in charge ofthis project were conducted at the BFPME headquarters.

20

Additionally, as a side story to the project, BFPME mentions that 43% of the SMEs eligible for

this project began exporting goods and 50% began a business related to technological

innovation such as IT. This indicates the belief that at the time of the ex-post evaluation

enterprises are still battling hard despite difficult economic conditions that persist.

Based on the above, this project has directly or indirectly underpinned sales of SMEs eligible

for BFPME’s subsidiary loans, increased employment, and reduced youth unemployment, while

also creating a foundation for SME’s management base and industrial competitiveness as well

as stable employment.

Source: National Institute of Statistics Source: National Institute of Statistics

Source: World Bank

Figure 1: Real GDP trends Figure 2: Foreign Direct InvestmentTrends

【Unit: %】 【Unit: million TND】

Figure 3: Export Value Trends

【Unit: USD 1,000】

21

Source: International Monetary Fund (IMF) Source: International Monetary Fund (IMF)Note: *year shows forecast Note: *year shows forecast

3.3.2.2 Other Positive and Negative Impacts

1）Impacts on the Natural Environment

This project targeted the businesses of SMEs with a low impact on the environment; and

therefore, it cannot be judged that direct impacts on the natural environmental occurred.

Interviews with BFPME revealed that subsidiary projects were selected so that there were only

minimal unwanted impacts on the environment or none at all, and officials stated that there were

no particular cases of environmental impacts arising from this project. In addition, to date no

complaints have been made in this regard. At the SMEs and surrounding sites visited at the time

of this survey, it was confirmed that there were no negative impacts on the natural environment.

Based on the above, it is judged that there were no negative impacts on the natural environment

from this project.

2）Resettlement and Land Acquisition

According to BFPME, similar to 1) above about impacts on the natural environment, no

negative impacts have occurred with regard to resettlement and land acquisition. At the SMEs

and surrounding sites visited at the time of this survey, it was also confirmed that there were no

negative impacts related to resettlement and land acquisition. The size of the enterprises

applicable to this project is relatively small, which it is thought that there were no cases where

large tracts of land and resettlement of the residents were acquired.

Figure 4: Trends in the Inflation Rate(5 years trend before ex-post evaluation and

forecast for the next 5 years)

Figure 5: Trends in the Unemployment Rate(5 years trend before ex-post evaluation and forecast

for the next 5 years)

【Unit: %】 【Unit: %】

22

As for effectiveness, of the quantitative effect indicators (operations and effect indicators),

the 1) Subsidiary loan repayment rate (actual results) is approximately half of the target. In

terms of 2) Rate of increase in sales (SMEs), 3) Rate of increase in operating income (SMEs),

and 4) Number of jobs (SMEs), at the time of the project’s appraisal the targets were said to be

“set at the start of the project,” but in actuality, these targets were not set. Therefore, the extent

of achievement of targets cannot be judged. On the other hand, it was confirmed through

interviews that the provision of loan opportunities helped to expand business size and reinforce

the production base of SMEs, and in the process promote employment of young workers. As for

impact, through interviews with these SMEs and BFPME, it was confirmed that this project

contributed to a certain extent to the reinforcement of industrial competitiveness and creation of

new employment opportunities. Taking into account the above, the implementation of this

project exhibited a certain effect, making the effectiveness and impact of this project fair.

3.4 Sustainability (Rating: ③)

3.4.1 Institutional Aspect of Operation and Maintenance

This project involved only subsidiary loans provided by BFPME; therefore, evaluation and

analysis will be carried out on BFPME. BFPME is a government-affiliated financial institution

established in 2005 in order to support financially the new establishment and development of

SMEs in Tunisia.

At the time of the ex-post evaluation BFPME’s workforce numbered 120, of which four

exclusive employees (at the headquarters) were assigned to the loan operations (loan receivables

collection and monitoring, etc.) for this project. BFPME’s basic operations entail lending to

SMEs, loan receivables collection, and monitoring, etc. In addition, BFPME has 21 regional

branch offices in Tunisia, and employees of each branch office are responsible for the same

operations as the headquarters, and when necessary, they carry out loan receivables collection

and monitoring, etc., as part of the loan operations for this project. According to BFPME, the

current operational structure has sufficient numbers of employees and branch offices, and with

regard to the whole 120 employees in the future, it could increase the headcount further in case

other loan programs outside of this project are expanded.

From the above, it is considered that there is no major problem regarding the institutional

aspect of operation and maintenance.

23

3.4.2 Technical Aspect of Operation and Maintenance

Nearly 90% of BFPME’s entire workforce is made up of permanent employees. According to

BFPME, the ratio of permanent employees is high compared to other commercial banks in

Tunisia and many of its employees have specialized skills when it comes to SMEs finance,

lending as well as loan receivables management and collection. The remaining 10% of its

employees are hired through outsourcing agreements and engage in day-to-day operations.

BFPME conducts training for employees on a regular basis. As recent examples, this training

included computers, management skills, and language (English). BFPME also carried out

on-the-job training for newly hired employees in a timely manner.

The qualifications held by BFPME’s employees include university degrees (from four-year

undergraduate or graduate school programs) related to general knowledge of the finance sector,

financial analysis, economics, and public finance. In the case of mid-career hires, most

employees are hired with strong professional experience and results in the finance sector.

BFPME carries out normal operations in accordance with the Credit Implementation

Procedure: 2009-DOSSI, a set of guidelines covering banking processes, management and

checks, etc., used as standard operating procedures in Tunisia.

From the above, it is considered that there is no major problem regarding the technical

aspect of operation and maintenance.

3.4.3 Financial Aspect of Operation and Maintenance

Unlike a private-sector commercial bank, BFPME is a government-affiliated financial

institution specializing in financing for SMEs in Tunisia. Table 5 shows the overall lending

situation of BFPME. Although detailed data was not provided by BFPME, interviews indicated

that the number of loans, number of customers eligible for loans (number of SMEs), and loan

balances are increasing annually. However, the percentage of loans underwritten through this

project do not account for a large portion of BFPME’s total outstanding loan balance (=approx.

65.77 million TND / 294,980 million TND). Table 6 shows the ratio of non-performing loans to

BFPME’s loans. According to BFPME, a ratio of 30% or below based on the number of loans

and loan value is the level permitted for government-affiliated loan programs for SMEs. It was

confirmed that the ratio of BFPME’s non-performing loans was kept at 30% or below from its

establishment in 2005 to the time of the ex-post evaluation (most recent). A senior management

of BFPME’s treasury division has mentioned “The scale of lending operations is increasing

annually, but the ratio of non-performing loans remains unchanged. In particular, the ratio of

24

non-performing loans for newly established SMEs has not increased all that much. There is no

major change throughout the year because, even if the ratio rises, repayments are taken into

consideration.” In light of this comment, it is judged that there are no particularly large

problems with BFPME’s financial standing. Additionally, in terms of the repayment rate of

BFPME’s subsidiary loans under this project (45% at the time of the ex-post evaluation), as

stated above the ratio of loans under this project to BFPME’s total loans outstanding is small,

and thus it is judged that there are no major concerns regarding how this rate will affect

BFPME’s financial standing. In other words, this rate will not be a factor inhibiting the effect of

this project.

Table 5: Overall Lending Situation of BFPME Including This ProjectTotal Number of

Loans * NoteTotal Number of Customers

Eligible for Loans (number ofSMEs) * Note

Total Loan Balance andCumulative

(Lending volume)1,587 1,195 294,980 million TND

Source: BFPMENote: Actual results at the end of 2017. The amount of loans indicates cumulative.

Table 6: Ratio of Non-performing Loans to BFPME (as of the end of 2017)Based on Number of Loans Based on Loans Values

29－30％ 22－23%Source: BFPME

From the above, it is considered that there is no major problem regarding the financial

aspect of operation and maintenance.

3.4.4 Status of Operation and Maintenance19

Going forward, BFPME is planning to make further efforts toward increasing the repayment

rate. As part of its institutional structure, BFPME does not have individual accounts; instead

SMEs that wish to receive loans from BFPME open and use an account with a private-sector

commercial bank and then receive the proceeds of the BFPME loan in this account. Therefore,

BFPME has difficulty in obtaining detailed information and understanding the management and

financial standing based on the flow of funds and the operating profit/loss, etc. related to the

SMEs’ business activities. There are agreements between private-sector commercial banks and

BFPME to provide and share information on the borrower’s cash flow, but in actuality such

agreements are not really functioning at the time of the ex-post evaluation. Given this situation,

19 To supplement, this project has not established any other counterpart funds or revolving funds (re-lending specialaccounts), which is a rotating fund utilizing it.

25

BFPME is examining the establishment of an independent financial organization (an

organization under the control of BFPME) in the near future in order for SMEs receiving loans

from BFPME to receive loans through this financial organization. In other words, BFPME is

planning to become directly involved in the loan business to ascertain cash flows as well as

provide advice to and monitor borrowers. As a result, the loan repayment rate is expected to

increase.

From the above, there are no major problems in the institutional, technical, financial aspects

and status of the operation and maintenance system. Therefore sustainability of the project

effects is high.

4. Conclusion, Lessons Learned and Recommendations

4.1 Conclusion

This project sought to develop a production base through the promotion of start-up

enterprises creation and expansion of existing enterprises by providing low interest rate and

medium- to long-term loans to small- and medium-sized enterprises (SMEs) in Tunisia in order

to contribute to the enhancement of the country’s industrial competitiveness and creation of new

employment opportunities. The Government of Tunisia’s 11th five-year plan (2007－2011) and

five-year development plan (2016－2020) indicate the need to strengthen management bases

through job creation and the provision of financing opportunities to SMEs. Relevance of this

project is high because there is a need for a lending program for SMEs because SMEs face

difficulty with borrowing funds from private-sector financial institutions (commercial banks,

etc.) due to insufficient collateral and because consistency with Japan’s ODA policy is

confirmed. As for efficiency, subsidiary loans were not implemented via eight commercial

banks accredited by MIEPME mainly due to the fact that SMEs' creditworthiness criteria by

accredited commercial banks became stricter due to the deterioration of economic conditions,

and SMEs were less likely to receive the loan. But the sub-loans were implemented only via

BFPME. Thus, the project cost was within the initial plan. The project period significantly

exceeded the initial plan because of delays in the borrowing procedures and screening of SMEs

receiving loans from BFPME due to the time consuming process within the Tunisian

government in transferring loan funds from account of subsidiary loans for SMEs via eight

accredited commercial banks to BFPME account, and because of the effects of the Jasmine

Revolution (democratization movement). Therefore, the efficiency is fair. As for quantitative

26

effects of effectiveness, the loan repayment rate (subsidiary loans) is about half of the target.

However, it was confirmed through interviews with SMEs and BFPME that contributions were

made to the enhancement of the country’s industrial competitiveness and creation of new

employment opportunities. Therefore, the effectiveness and impact of this project are fair.

Taking into account that BFPME, responsible for the operation and maintenance of this project,

regularly conducts monitoring of enterprises and the collection of receivables through its head

office and regional branches, has human resources with expertise, and has not seen a large spike

in the ratio of non-performing loans, there are no particular concerns in terms of the institutional,

technical and financial aspects. Thus, sustainability of the effects realized through this project is

high.

In light of the above, the project is evaluated to be satisfactory.

4.2 Recommendations

4.2.1 Recommendations to the Executing Agency

BFPME is commended for examining initiatives at the time of the ex-post evaluation,

including establishing an independent financial organization (organization under the control of

BFPME) to maintain its influence in the lending business and increase the loan repayment rate.

It is desirable that BFPME continue to work on increasing the loan repayment rate, including

for subsidiary loans under this project.

4.3 Lessons Learned

Need for project risk management (give flexibility to lending route) for realization of project

effect

As a yen loan project to Tunisia, this project was the first financial intermediary loan.

Although it was confirmed before the start of this project that there were strong needs for loans

among SMEs, there was no precedent of a loan program in Tunisia, and consideration was given

to having more than one lending route option as a way to mitigate risk. As a result, two lending

routes were formed: subsidiary loans for SMEs via the eight accredited commercial banks and

subsidiary loans of BFPME. Eventually, only the latter was adopted and the size of the project

was reduced. The continuity of the project itself is secured and the effects of the project are

secured to a certain extent. Taking this into consideration, it is meaningful that from the

beginning project risk management for exhibiting project effects was considered and actually

27

functioned during the project. When establishing similar projects in the future, particularly in

countries where development finance programs have not been implemented before, giving

flexibility to the lending format (in other words, having multiple lending routes) while taking

into account the loan needs of SMEs in the country is believed to be worth considering.

28

Comparison of the Original and Actual Scope of the ProjectItem Plan Actual

1. ProjectOutputs

1) Mid- and long-term Two-StepLoan (TSL) to SMEs

( ① subsidiary loans mainly forsupporting start-up enterprises viaBFPME and ②subsidiary loans forsupporting business expansion ofSMEs via accredited 8 commercialbanks)2) Consulting Services (It isplanned to employ consultant whosupports for project implementationand supervision to the executingagency and the steering committeeestablished for this project,supports for holding of the steeringcommittee meeting, supports forproject progress report / externalaudit to the executing agency andJICA, and conducts monitoring andadvice on management for enduser.)※ Details are shown in Table 2

1) Mid- and long-term Two-StepLoan (TSL) to SMEs( ① implemented, ② notimplemented)

2) Consulting ServicesThe consulting services were notcarried out.

※ Details are shown in Table 22. Project Period March 2007 – December 2011

(58 months)March 2007 – January 2016

(107 months)3. Project Cost

Amount Paid inForeign Currency

Amount Paid inLocal Currency

Total

ODA LoanPortion

Exchange Rate

6,153 million yen

438 million yen

6,591 million yen

6,277 million yen

1 TND=87.9 yen1USD=117 yen

（As of January, 2007）

3,993 million yen

0

3,993 million yen

3,993 million yen

1TND=60.88 yen1USD=97.52 yen

（Average between 2008 and2016, based on rates issued by

the IMF’s International FinancialStatistics Data)

4. FinalDisbursement January 2016

1

Republic of Tunisia

FY2017 Ex-Post Evaluation of Japanese Grant Aid Project

“The Project for Desalination of Groundwater in Southern Region”

External Evaluator: Kenichi Inazawa, Octavia Japan Co., Ltd.

0. Summary

This project constructed the desalination system of groundwater by reverse osmotic

membrane method to increase the amount of water supply and improve water quality, salinity

concentration, in Ben Gardane district in Medenine Governorate located in the coastal region of

southern Tunisia, and to contribute to stability of the living environment of residents around the

district. To raise water supply rate, to secure drinking water and to improve water quality in

urban and rural areas are presented in the 11th Social-Economic Development Five-Year Plan

(2007-2011) formulated by the Tunisian government and the Five-year Development Plan

formulated by the Water Resources Development Corporation (Société Nationale d'Exploitation

et de Distribution des Eaux), hereafter referred to as “SONEDE”, the executing agency of the

project. In addition, the development needs for expansion of water supply demand around the

district have been confirmed. It was also confirmed that this project was relevant to Japan’s

ODA policy. Therefore, its relevance is high. Regarding efficiency, the outputs were largely as

planned, and the project cost was also within the initial plan. On the other hand, regarding the

project period, it exceeded the initial plan as the construction of the pump station by Tunisian

side required the time to assemble the drilling equipment and to join underground cable buried

at the pumping station. Therefore, its efficiency is fair. Regarding the quantitative effect

indicators of the project such as data of supply and quality of water to Ben Gardane district,

after the completion of the project, the amount of daily average water supply has reached the

initial target amount, while the water quality, salinity, has not been achieved the target. In

addition, in the interview survey to residents around the district, there were dissatisfied opinions

that “salinity concentration was high, amount of water supply was low, and pressure of water

supply was low”, and additionally, it was confirmed that the non-revenue water rate in the

district was also high. Thus, it is assumed that its impact is limited. Therefore, its effectiveness

and impacts of this project are fair. There is no particular concern in terms of institutional,

technical and financial aspects of the Desalination Service Station of Ben Gardane District

Regional Branch Office of Medenine Governorate, and Southern Regional Branch Office of

Sfax which are responsible for the operation and maintenance of this project. There is no

particular problem in the operation and maintenance status of other facilities and equipment.

2

Therefore, the sustainability of effects developed by the project implementation is high.

In light of the above, the project is evaluated to be satisfactory.

1. Project Description

Project Location Desalination Facilities Developedby the Project

1.1 Background

Prior to the start of this project, in Ben Gardane district in Medenine Governorate in the

southeastern part of Tunisia close to the border town with neighboring Libya, there were

concerns about the increase in water demand due to the rapid population increase and the land

degradation due to the desertification presumed to be caused by the recent climate change. The

water supply to the district which did not have water source in the vicinity depended on the

long-distance water supply from the well water sources more than 60 km away and from the

water distribution network in the southern area. However, the amount of water source tends to

be insufficient year by year according to the demand. Especially during the dry season, a large

amount of water was consumed when the water was divided into the surrounding areas in the

pipeline section supplying water to the district, and a long-term water outage occurred around

the district. For this reason, it was assumed to be difficult to continue to secure a sufficient

amount of water in the future. In addition, as its salinity concentration was rising, the water

quality sent from the other districts did not meet 1.5g per liter, the target of SONEDE’s water

quality. For this reason, it was also an urgent task to respond to salinization.

1.2 Project Outline

The objective of this project is to increase amount of water supply and improve water quality,

salinity concentration, in the Ben Gardane district in Medenine Governorate located in the

3

coastal region of southern Tunisia by constructing the groundwater desalination system by

reverse osmotic membrane method for new water sources, thereby contributing to stabilize the

living environment of residents around the district.

Grant Limit/ Actual GrantAmount

1,000 million yen (Initial),1,023 million yen (After revision)

/ 1,023 million yenExchange of Notes Date/Grant Agreement Date

March 2010 (Initial), March 2014 (After revision)/March 2010 (Initial), September 2010 (1st revision),

December 2014 (2nd revision)Executing Agency SONEDEProject Completion June 2013

Main Contractor Takaoka Engineering Co., Ltd. & Suido Kiko Kaisha,Ltd. (JV)

Main Consultant Ingérosec Corporation& Nihon Techno Co., Ltd. (JV)Procurement Agency Japan International Cooperation SystemPreparatory Survey November 2009 – August 2010 (Preparatory Survey)

Related Projects 【ODA Loan Project】“Rural Water Supply Project (1)” (L/A signed in 2000)“Rural Water Supply Project (2)” (L/A signed in 2003)“Water Supply and Sewage System ImprovementProject in South-Tunisia” (L/A signed in 1995)“Sfax Sea Water Desalination Plant ConstructionProject” (L/A signed in 2017)【Other Donors’ Cooperation】

“Water Supply Improvement Plan in SouthernTunisia”, Kreditanstaltfür Wiederaufbau Bankengruppe(KfW)(2004)

“Rural Water Supply Plan and Modernization Supportof SONEDE”, Agence Francaise de Developpement(AFD) (2003)

“Urban Water Supply Improvement Plan”, World Bank(IBRD) (2005)

“Program of Improvement of Water Quality in theSouth II” (PNAQ2), KfW (2015-2020 scheduled)

2. Outline of the Evaluation Study

2.1 External Evaluator

Kenichi Inazawa, Octavia Japan Co., Ltd.

2.2 Duration of Evaluation Study

This ex-post evaluation study was conducted with the following schedule.

Duration of the Study: September, 2017 - December, 2018

4

Duration of the Field Study: January 6-18, 2018 and April 9-13, 2018

2.3 Constraints during the Evaluation Study

In this study, since the external evaluator was unable to enter the project site for security

reasons, the evaluator scrutinized information and data, etc, obtained by the collection and

interview survey done by the local assistant who was employed under this survey. Then,

analysis and judgment of this evaluation was conducted.

3. Results of the Evaluation (Overall Rating: B1)

3.1 Relevance (Rating: ③2)

3.1.1 Consistency with the Development Plan of Tunisia

At the time of project planning, the Tunisian government formulated the 11th

Socio-Economic Development Five-Year Plan (2007-2011), and it was intended to raise the

water supply rate of household served to 97% at the national level and at least to 85% in whole

rural area by 2011. Moreover, in addition to effective utilization of water resources, etc, through

water saving, the plan has positioned the expansion of water supply and the improvement of

water quality in the southern region as one of the development plans.

At the time of the ex-post evaluation, the Tunisian government has formulated the Strategic

Development Plan of Tunisia (2016-2020), and the stable drinking water supply is positioned as

one of the major pillars to improve the living standards of residents, especially to contribute to

that of rural residents. As of 2014, the water supply rate throughout the country is 98.2%, while

the water supply rate in rural areas remains at 94.6%, and the government aims to raise the

water supply rate of rural areas to 96.0% in the plan. In addition, SONEDE has formulated the

Five-Year Development Plan (2016-2020) and emphasized securing drinking water, improving

water quality, efficient and rational use of water, and conservation of water resources, etc, in

urban and rural areas, especially in villages.

In view of the above, even at the time of ex-post evaluation, Tunisia continues to place

importance on stable water supply, improvement of water quality, increase of water supply rate

in rural areas, etc. Therefore, consistency with policies and measures in the national plan, sector

plan, respectively are recognized both at the time of planning and at the time of ex-post

evaluation.

1A: Highly satisfactory, B: Satisfactory, C: Partially satisfactory, D: Unsatisfactory2③: High, ②: Fair, ①: Low

5

3.1.2 Consistency with the Development Needs of Tunisia

Prior to the start of this project, the population of Ben Gardane district3 was 64,000 in 1994,

but it increased to 73,000, about 14,000 households, in 2008.There was concern about the

increase in water demand due to the population increase and the progress of desertification and

deterioration of land presumed to be caused by the climate change. Although SONEDE had

been conducting water supply projects in the district, the water supply to the district without a

source of water in the vicinity was obliged to rely on well water sources more than 60 km away

and a long-distance water supply from other distribution networks. However, such water

distribution from wells and a long-distance water supply was becoming insufficient year by year

against the water demand. Particularly during the summertime, a long-term water outage was

confirmed around the district because a large amount of water was consumed as water was

divided into the surrounding areas of the pipeline section supplying water to the district. For this

reason, it was predicted to be difficult to secure a sufficient amount of water in the future. In

addition, the salinity concentration of the water to be sent increased from 1.4g per liter in 1999

to 1.7g per liter in 2004, exceeding the SONEDE’s standard (target) of water quality of 1.5g per

liter. In addition, around the district, it was regarded as an urgent task to respond to the

salination because further aridification and instability of rainfall influenced by the climate

change was expected and because it was disadvantaged to have groundwater with good quality,

salinity concentration is high4. Therefore, the needs for water source development and water

quality improvement around the district were high.

At the time of ex-post evaluation, SONEDE has conducted the Program of Improvement of

Water Quality in the South II or Amélioration de la Qualité des Eaux du Sud, hereafter referred

to as “PNAQ2”5 for the purpose of increasing amount of water supply and decreasing salinity

in response to changes in the demand for water supply due to population increase6 in the south

3 The Ben Gardane district is located near the border with Libya. It is a town where a lot of household goods andappliances are flowing in from Libya, and commercial business is popular.4 The south of Tunisia is disadvantaged with water resources, and even for meager water resources, surface waterconcentrated in the north. And it has to rely on groundwater resources in the central and south. The aquifers with lowsalinity concentration suitable for drinking water are localized unevenly. Especially in the southwestern region, theamount of water source was insufficient against the water demand year by year, and the salinity concentration washigh. (Source: JICA Preparatory Survey Report)5 Mainly, being implemented by the support of German Reconstruction Finance Corporation or KreditanstaltfürWiederaufbau (KfW). Mainly construction of 8 deep wells and 1 desalination treatment facility, capacity: 9,000m³/day. The budget amount is 171 million Tunisian Dinar. It started in 2015 and is planned to be completed in 2020.6 As of the time of ex-post evaluation, the number of residents in the Ben Gardane district is 82,560 people. (Source:Estimated value of 2017 by the evaluator based on the 2014 census.). Before the project started, it was 73,000 people(Source: 2008 census).It can be seen that the growth rate is about 13% in 6 years and is high (= about a little over1.5% per year). It can be said that this growth rate explains the increase in demand for water supply.

6

of Tunisia including Ben Gardane district. As described later in the “3.3.1.1 Quantitative Effect,

Operation and Effect indicators”, regarding the water quality supplied to the district, the salinity

decreased at the commencement of service of the project facilities, June 2013. However, the

high situation of the salinity continues as the demand for water supply in the district increases

after that.

In view of the above, even at the time of ex-post evaluation, the program to improve water

quality such as efforts to increase amount of water supply and decrease salinity have been

implemented in the Ben Gardane district. Therefore, it can be said that consistency with

development needs is recognized both at the time of planning and at the time of ex-post

evaluation.

3.1.3 Consistency with Japan’s ODA Policy

In the Country Assistance Program for Tunisia formulated by the Ministry of Foreign Affairs

in October 2002, (1) support for upgrading industries, (2) support for water resource

development and management, and (3) support for environmental initiatives were listed as the

priority fields and task-based assistance policy. Among them, regarding (2) support for water

resource development and management, it was proposed that “the cooperation is promoted by

making full use of Japan’s experience and technology for not only the support to development

of water resource but also the support leading to the comprehensive management of water

resources including the management of water supply and demand and the management of

surface water and underground water. From the viewpoint of the promotion of rural areas and

poor areas that are lagging in development, consideration will also be given. Therefore, the

project corresponds to Tunisia with the above-mentioned prioritized fields and task-based

assistance policy, (2) support for water resource development and management in the above,

and its consistency with Japan's assistance policy is recognized.

Based on the above, the implementation of the project has been highly relevant to Tunisia’s

development plan and development needs, as well as Japan’s ODA policy. Therefore, its

relevance is high.

7

3.2 Efficiency (Rating: ②)

3.2.1 Project Outputs

This project constructed a desalination plant at a location about 7 km north of the center of

Ben Gardane district in Medenine Governorate for the purpose of lowering the salinity

concentration of the water supply and eliminating the long-term water outage in summertime.

Table 1 shows the planned and actual outputs of this project. It is judged that actual result was

mostly as originally planned.

Table 1: Planned and Actual Outputs of This ProjectAt the time of planning (2010)7 Actual: At the time of project completion

(2013)【Planned Inputs from Japanese side】(1)Development of main facilities related to adesalination plant (amount of desalinatedwater: 1,791 m³/day, RO membrane method(installation series: 2 series)) and relatedequipment(2) Installation of water tanks (raw wateradjustment tank: 500m³, filtered water tank150m³, desalinated water tank 170m³, andwaste water tank 70m³)(3) Construction of concentrated watertreatment facility (Size: 11.9ha)(4) Construction of a concentrated waterdrain pipeline (about 0.1 km & piping 150mm) and a solar evaporation pit.(5) Development of a solar power generationsystem (system with 30kW outputs asauxiliary for commercial power)

【Actual Results from Japanese side】(1)(2)(3)(4)(5): Mostly as planned.(For (1), the number of installed ROmembranes has been increased from 2 seriesof initial plan to 3 series, and for (5), theoutputs of the solar power generation systemhas been increased from 30 kW of initial planto 210 kW.)

【Planned Inputs from Tunisian side】(1) Laying a desalinated water transmissionpipeline (about 6 km) from a desalinationplant to the existing distribution pond(2) Development of pumping of raw waterwells and deep wells (pumping capacity: 37liters per second or more)

【Actual Results from Tunisian side】(1)(2): As planned.

Source: JICA documents, answers on questionnaire

The outputs of Japanese side were mostly implemented as planned. The differences between

planned and actual are as follows; Since the bid price was lower than the estimated price at the

price opening bid of the contractors, December 2012, and the remaining money was generated,

7There was no change in the output plan at the time of detailed design (D/D).

8

1) as for the Reverse Osmosis Membrane8, hereinafter referred to as “RO membrane”, the

number of series of installed membrane was increased from two series of initial plan to three

series, and 2) as for the solar power generation system, such change as the output expansion

from 30 kW of initial plan to 210 kW, etc, was done. Regarding the number of series of installed

membrane of 1), specifically, the system was changed to a system in which one series was

prepared for back up for emergencies and the remaining two series were for the desalination

treatment. It is because it was judged that preparing for failure and emergency was a stable

operation although it was planned to have no backup initially. Amid the growing demand for

water supply in Ben Gardane district, there is also a background that the stable operation of

desalination facilities of the project was regarded as important. Regarding the expansion in

output (210 kW) of the solar power generation system of 2) also, there is a background that it

was aimed at executing stable operation of the equipment of the project although it plays a role

as an auxiliary for the main power supply for the relevant equipment in the desalination plant.

The outputs of Tunisian side were also carried out as planned.

3.2.2 Project Inputs

3.2.2.1 Project Cost

Regarding the total project cost of this project, the initial plan was about 1,183 million yen,

the amount to be borne by Japanese side was 1,023 million yen9 and the one by the Tunisian

8 The RO membrane is a semi permeable membrane that allows only water to pass through without passing salt andthe like. It is also used when taking out fresh water from seawater. The method using the RO membrane, ROmembrane method, has a feature that energy consumption necessary for obtaining fresh water is smaller than that inthe evaporation method.9 The initial plan of project cost was 1,000 million yen. After the project started, the amount of G/A was changed to1,023 million yen. The circumstances are as follows: due to the impact of attack incident to the natural gas plant inAlgeria in January 2013, the security deterioration in the neighboring country of Tunisia was also assumed.According to the instruction of Ministry of Foreign Affairs of Japan, the concerned Japanese evacuated from March 6

Photo1: Inside of Desalination Plant Facilities Photo 2: Solar Power Generation System

9

side was 160 million yen, whereas actual amount was about 1,103 million yen, actual amount of

the Japanese side was 1,023 million yen and that of the Tunisian side was about 80 million yen.

It was almost as initially planned (about 93% of the plan).

3.2.2.2 Project Period

This project was planned to be completed from March 2010 to April 2012 (26 months)10. The

actual period was from March 2010 to June 2013 (40 months) and exceeded the plan (about

154% compared to the plan). The main reason for the excess is that concerning the improvement

of pump station by Tunisian side, it took time to assemble drilling equipment and to join the

underground cable at the pumping station, and the construction work of Japanese side was also

affected (a total of 14 months11). About one year since its launch in June 2013, SONEDE was

coordinating the grid connection of the solar power generation system and commercial power

supply, mainly verification of standard and procedure of electrical system connection, with

Tunisian Corporation of Electricity & Gas (Société Tunisienne de l’Electricité et du Gaz;

STEG)12. However, such delay did not affect the start of service in June 2013.

In view of the above, this project outputs were mostly as planned, and the project cost was

within the plan. The project period exceeded the initial plan due to the fact such as that it took

time to assemble the drilling equipment mainly concerning maintenance of the pump station and

to join the underground cable for the pumping station on Tunisian side, etc. Accordingly,

although the project cost was within the plan, the project period exceeded the plan. Therefore,

efficiency of the project is fair.

to April 5 in the year. The persons evacuated in the project were the consultants for construction supervision. Thepayment of additional expenses, evacuation and overhead expenses, that occurred during the temporary evacuationperiod was approved by JICA and was paid to the consultants. Based on the revised G/A, 23 million yen wasincreased. Although there was no increase in outputs, it can be said that the increased amount, the increase in theplanned project cost, caused by the evacuation instruction was inevitable.10 The initial project period was 25 months in total, but as stated in 3.2.2.1 Project cost, according to the instructionof the Ministry of Foreign Affairs of Japan, the concerned Japanese were due to evacuate between March 6 and April5, 2013, approx. 1 month. The analysis was done after resetting the project period being 26 months in total by addingabout one month to the project period of the initial plan.11 It was not possible to confirm the breakdown of the14 months.12 In other words, it was originally scheduled to be completed in June 2013, in a total of 26 months with the additionof 1 month, as same as the construction period of the Japanese side. However until June 2014, the work continued onTunisian side.

10

3.3 Effectiveness and Impacts13 (Rating: ②)

3.3.1 Effectiveness

3.3.1.1 Quantitative Effects (Operation and Effect Indicators)

1) Operation Indicator

In this project, major facilities related to desalination plant and the related various equipment

were developed. Table 2 shows the trend of the amount of daily average water supply, baseline,

target, and actual value, which are the quantitative effect indicators.

Table 2: Amount of Daily Average Water Supply (baseline, target, and actual value)(Unit m³/day)

Baseline(2009)

Target(3 years aftercompletion)

Actual2012 2013 2014

(Before completion) (Completion) (1 year aftercompletion)

7,690*Note 1

9,481*Note 2

10,021 11,869 12,687

2015 2016*Note3 2017(2 years aftercompletion)

(3 years aftercompletion)

(4 years aftercompletion)

12,250 12,233 12,821Source: SONEDE*Note1: The breakdown of the baseline was 4,530 m³/day of water from the southern distribution network, 3,160m³/day of water intake from the deep wells of Maouna, 4 wells, and 7,690 m³/day in total.*Note 2: It was expected that the total would be 9,481 m³/day by additional 1,791 m³/day (see Table 1) of the designtreated volume by the desalination plant of this project to 7,690 m³/day.*Note 3: The black bold frame shows the actual target year (3 years after project completion, 2016).

(Reference) The breakdown of the amount of daily average water supply (actual) of Table 2 isas follows;

Table 3: Amount of Daily Average Water Supply (Actual)(Unit m³/day)

Water source

Actual*Note 1

20122013

2014Up to JuneJuly

Completion*Note 3

From August*Note 4

SouthernDistribution

Network5,544 5,493 4,768 5,145 5,5185,544 5,493 4,768

Maounadeep wells 4,075 4,369 3,486 3,744 3,9034,075 4,369 3,486

Marsa deepwell

(SDBG*Note2)- - 1,519

(Start) 1,494 1,608

13 Sub-rating for Effectiveness is to be put with consideration of Impacts.

11

Ourasniadeep well - - - 1,161

(Start) 1,229

Sayahdeep well 402 355 295 327 429402 355 295 327 429402 355 295 327 429

Total 10,021 10,217 10,068 11,869 12,68710,217 10,068

Water source 2015 20162017

Up to August In/After September*Note5

SouthernDistribution

Network5,829 5,783 5,958 5,438

Maounadeep wells 3,120 3,550 4,097

*Note 63,898*Note 6

Marsa deepwell

(SDBG*Note 2)1,551 1,375 1,344 0

Ourasniadeep well 1,661 1,202 1,422 943

*Note 7Sayah

deep well 89 323 - -

Total 12,250 12,233 12,821 10,279Source: SONEDE*Note1: It shows the peak water supply throughout the year.*Note2: SDBG is abbreviation of Station de Dessalement Ben Gardane (This project: Desalination plant of BenGardane).*Note3: The completion of this project, commencement of the service, is at the end of June 2013. On the otherhand, in Table 2, for the sake of convenience, the completed month is set as July. The reason for this was thatactual data of Marsa deep wells began to be measured (= water intake was started from a new well in earnest) inJuly.*Note4: Because water intake from a new well occurs in July and August in 2013, the periods are describedseparately as “up to June”, “in July”, and “from August”.*Note5: The Marsa deep well was connected to the desalination plant of this project and the desalination treatmentwas carried out. But on September 6, 2017, water intake was stopped as it became difficult to use the well as a largeamount of sand blew out. After that, water supply from the Ourasnia deep well is connected to the facility and thedesalination treatment is carried out. For this reason, the data of daily average water supply at the peak time up toAugust and the peak time in/after September is described separately.*Note6: The water intake of the Jallel deep well is added to the data of daily average water supply of the Maounadeep wells since January 2017.*Note7: Numeral values underlined in the table indicate the actual value of treated volume connected to SDBG.

Table 4: Forecasts of Future Water Supply Demand in Ben Gardane District(Daily Average Water Supply During Peak Month)

(Unit m³/day)2018 2019 2020

12,954 13,602 14,282Source: SONEDE

As shown in Table 2, the actual amount of the daily average water supply is higher than the

target (9,481 m³/day) of that in Ben Gardane district from 2012 which is before the completion

of the facility. The reason for this is that, as pointed out in 3.1.2 Consistency with Development

Needs, there is an increase in demand for water supply in the district due to the population

increase. In other words, SONEDE has established a system to increase the amount of water

12

supply against the increasing demand of water supply14. As shown in Table 3, SONEDE has

increased the number of water sources, deep wells, year by year. As a concrete measure, from

the start of operation of this project facility to the time of ex-post evaluation, SONEDE has

invested its own budgets, developed two deep wells of Ourasnia and Jallel, and distributed

water to the district. In other words, although it cannot be said directly that the target value

exceeds the initial plan due to this project implementation as the demand for water supply is

increasing, it can be said that this project is contributing to the stable supply of water

considering that the water taken from the deep wells is desalinated and constitutes the water

supply amount for the entire district. In addition, the amount of desalinated water at the facility

of this project achieves around 80% of the initially assumed treated volume, 1,791 m³/day, until

the Marsa deep well described below stops water intake. In view of this, it can be said that there

is almost no problem as a driving function of the facility.

To further describe the breakdown of Table 3, after this project completion, the water taken

from Marsa deep well was sent to the facility of this project for desalination. However, it was

stopped to take water from the well which became difficult to use as a large amount of sand

blew out on September 6, 2017. This was an unexpected event, but as a countermeasure to this,

SONEDE had to switch the line of RO membrane series used for water supply from the Marsa

well until then to the water supply from Ourasnia deep well, and the desalination treatment was

started. With regard to the water supply from Marsa deep well, two RO membranes series were

used, and the treatment of desalinated water was carried out for the water supply of 30 liters per

second15, 15 liters per second × 2 series, before the suspension of water intake. On the other

hand, since the amount of water sent from the Ourasnia deep well was as small as 19 liters per

second, SONEDE judged that there was no operational problem by coping with one series after

switching, 19 liters per second × 1 series. In other words, as of the time of ex-post evaluation,

two series of RO membranes, 1 series for all times + 1 series for backups, are not used.

According to SONEDE, in the near future, it is considered to increase the treated volume of

water desalination by drilling and starting water intake from anew deep well around the

Ourasnia deep well and by a system of three series in total using also one series for back up16.

Table 4 shows the forecasts of future demand for water supply, amount of daily average water

14 Since SONEDE supplies and distributes water according to the demand for water supply in Ben Gardane, the dataof amount of water supply in the table indicates that it is synonymous with the actual demand for water supply.15 It was designed to be 31 liters per second in the JICA preparatory survey (Source: Preparatory Survey Report)conducted before the project started.16 SONEDE is focusing on intensive operation in summer time especially when the demand for water supplyincreases.

13

supply, in Ben Gardane district, which is expected to continue to grow for the foreseeable future.

Looking at this trend, it can be said that SONEDE is required to increase the amount of water

supply in the future.

2) Operation Indicators

Table 5 shows the transition of water quality (salinity). The baseline, target, and actual value

in the table indicate the water quality of the supplied water which is mixed with the desalinated

water of this project and the water of other water sources and is distributed to entire Ben

Gardane district. Regarding the target value among them, according to the ex-ante evaluation

sheet, the desalinated water produced in this project has a salinity of 0.3g per liter (design value).

By mixing this with the existing drinking water with high salinity, it was expected that the final

salinity for drinking would be reduced to 1.8g per liter17.This project was expected to contribute

to realization of the target.

The basis of calculation of actual water quality, salinity, of each timing in Table 5 is shown in

the appendix at the end.

Table 5: Water Quality (Salinity) *Note 1(Unit: g/liter)

Baseline（2009）

Target(2015:

3 years after

completion)

Actual2012

(Before completion)2013

Up to June July(Completion) *Note2

From August

2.1 1.8

2.6 2.4 2.0 2.82014

(1 year aftercompletion)

2015(2 years aftercompletion)

2016(3 years aftercompletion)

*Note3

2017(4 years after completion)Up to

AugustIn/After

September

2.8 2.8 3.0 2.7 2.1Source: SONEDE*Note1: This table is consistent with the notation of Table 3 as much as possible. In addition, the basis forcalculating the actual value is shown in the appendix at the end.*Note 2: The completion of this project, commencement of service, is at the end of June 2013. On the other hand, inTable 2, the completion month is July. The reason is as in Table 3.*Note3: The black bold frame shows the actual target year, 3 years after project completion, 2016.

As mentioned above, the desalination facility of this project was connected to the Marsa deep

17 The water quality standard of Japan is 0.5 g per liter. The salinity standard in Tunisia is 2.5g per liter, but inthe11th Socio-Economic Development Five-Year Plan announced by the government in 2007, in districts where waterwith a salinity of 2.0g per liter or more was produced, the target was specified to decrease to 1.5g per liter or lower,lower than the standard of the country.

14

well and carried out desalination treatment. At the completion of this project in July 2013, the

salinity concentration decreased to 2.0g per liter due to the start of water intake of the deep well

and the water desalination. On the other hand, the salinity concentration rose to 2.8g per liter

from August the same year. The reason for this is the use of the Ourasnia deep well has started

(see Appendix at the end).Even after 2014, the target value has not been attained because it is

distributed by being mixed with the Sayah deep well and the Jallel deep well which are not

desalinated with high salinity concentration.

In reality, while the demand for water supply in Ben Gardane district is increasing, SONEDE

has no choice but to give priority to measures to increase the amount of water supply and the

salinity concentration has not been reduced yet. In other words, it is in a situation that the

increase of the amount of water supply and decrease of the salinity cannot be simultaneously

achieved. As already mentioned, the Marsa deep well has been stopped in September 2017 and

the desalination treatment is carried out by switching the line to the water supply from the

Ourasnia deep well. In any case, as shown in Table 5, the salinity of the entire water supply

distributed to the district is 2.1g per liter, and it has not reached the target value. The reasons

why it decreased from 2.7g per liter to 2.1g per liter in/after September 2017can be because the

water intake from the Marsa deep well was stopped, the line was switched to the water supply

from the Ourasnia deep well, and the desalination treatment at this project facility has been

started, etc. For this reason, as shown in Table 3, the amount of daily average water supply is

decreasing compared to the previous period, 12,821 m³/day to 10,279 m³/day.

Figure 1: Location of Project Sites

15

3.3.1.2 Qualitative Effects

Realization of stable water supply

At the time of ex-post evaluation, the water supply from the Ourasnia deep well connected to

the desalination facility prepared by this project is desalinated, distributed to the entire Ben

Gardane district, and is thought to have contributed to the stable supply. On the other hand, the

salinity concentration of water supply as a whole amount is high as already mentioned, and it

can be said that further improvement is required18.

3.3.2 Impacts

3.3.2.1 Intended Impacts

Contribution to the stability of living environment of residents around Ben Gardane district

(improvement of long-term water outage in summer)

Prior to the start of this project, as explained in 3.1.2, in Ben Gardane district, it was assumed

that it would be difficult to secure the adequate amount of water in the future. Regarding the

condition at the time of ex-post evaluation, in this study, an interview survey was conducted to

the residents living around Ben Gardane district in order to complementarily explore the actual

state of data of 3.3.1.1 Quantitative effects (Operation and effect indicator)concerning the water

supply condition, especially outage, hour, pressure, taste, turbidity, smell, color of water supply,

etc. Table 6 and 7 show the results. First of all, at SONEDE, data on the long-term water outage

was not managed. Therefore, it was unknown by the quantitative data as to how long the water

outage occurred, however, as shown in Table 6, it turned out that the occurrence of the water

outage itself increased with the timing of completion of this project, June 2013. From the

residents, many comments as “there are many water outages in the hot season from every June

to September. The frequency of water outage is increasing year by year. Improvement in water

supply situation is not seen” were obtained. In addition, as shown in Table 8, items other than

turbidity, color and smell tend to be largely dissatisfying. In this interview survey, as the size of

survey against the residential population (a population) is small, and it is difficult to be

conclusive. However there is a high possibility that the residents are not satisfied with the

condition of water supply such as the pressure and amount of water supply. As for the salinity

18 As of the time of ex-post evaluation, SONEDE has implemented PNAQ2 as already mentioned. Construction offacilities such as 8 deep wells and 1 desalination treatment facility, etc., (capacity: 9,000 m³/day, planned to becompleted around 2020) in the district is planned to be implemented full-scale from now on. After completion, thesalinity concentration of the water distributed to the district would also decline, and SONEDE expects to improve thepressure, amount and hour of water supply, etc.

16

concentration and taste, it is considered to be a major factor that the salinity is not improved as

already mentioned.

Further, regarding the pressure and amount of water supply, it is inferred that there are

problems in the environment surrounding the distribution network around Ben Gardane district.

Specifically, as shown in Figure 2, the non-revenue water rate in the district tends to be higher

than the nationwide standard of Tunisia. The factors for high non-revenue water rate are

considered to be 1) the water distribution pipeline being aged, 2) the water meter not being

functioning satisfactorily, 3) the connection being illegal, and 4) the influence from water fee

not being paid, etc. It is necessary for SONEDE to make countermeasures after the detailed

investigation of the actual situation.

Table 6: Results of Interview to Residents around Ben Gardane District on Water Outage(28 Interviewees)

Frequency Before project start(Before June 2013)

After project completion(In/After July 2013)

Everyday 2 11Twice/ Week 3 2Once /Week 9 6Once /2-Weeks 3 2Once /Month 1 2None 10 5Source: Results of interview to 28 beneficiariesRemarks: It was questioned whether there were any changes in the situation of water outage occurrenceon the timing of project completion of this project facility, before June 2013 and in/after July 2013.

Table 7: Results of Interview Survey on Water Supply to Residentsaround Ben Gardane District

(28 Interviewees)Item Satisfied Normal Unsatisfied

Salinity Concentration 0 4 24Taste 0 4 24

Turbidity 2 18 8Color 5 16 7Smell 27 1 0

Water Supply Pressure 2 8 18Water Supply Amount 0 10 18

Source: Results of interview to 28 beneficiaries

17

Source: SONEDE (The upper row is calculated based on data retained(≓amount of water supply –amount of revenue earning water))

Figure 2: Trends in the Non-Revenue Water Rate in Ben Gardane District and Across Tunisia(The upper row is non-revenue water rates of Ben Gardane district and the lower row is that of

the nationwide average)

3.3.2.2 Other Positive and Negative Impacts

1）Impacts on the Natural Environment

The environmental impact assessment (EIA) of this project was approved by the Tunisian

Environmental Protection Agency (ANPE) in May 2011 before the project started. In addition, it

was confirmed by interview to SONEDE that during the project implementation and after

completion of the project, the negative impact on this natural environment, e.g. air pollution,

vibration, noise, and ecological effects, etc, by this project did not occur. In this field study, the

impact on the natural environment around each site was visually checked, but no particular

problem was found.

The upper row of Table 8 shows data of the water quality treated in the desalination plant, and

the chlorine is within the standard of water quality in Tunisia. As of the time of ex-post

evaluation, the chlorine is zero as it was not injected in the desalination plant facilities. On the

other hand, water after desalination treatment is mixed with water from other deep wells, and

chlorine is added at that stage. The middle row shows data of the quality of water supply to Ben

Gardane district, chlorine at this stage is between 0.85 to 0.95mg per liter, which is within the

standard of water quality shown in the lower row. Other data of water quality is generally within

the standard as well. As for the hardness, as the numerical values of other deep wells are high, it

exceeds the standard19.

19 The numerical values of hardness are 253-269 °F at the Ourasnia deep well, 90°F at the Maouna deep wells, and130°F, etc, at the southern distribution network. Those are mixed with water of 0.2-0.6 °F of this project and became

[Unit: %]

18

Table 8: Quality of Water Desalinated at the Project Facility (upper row), Quality of Water Sentto Ben Gardane District (middle row), and Standard Quality of Water of Tunisia (lower row)

Item Chlorine PH Turbidity Hardness ColorWater quality

desalinated at thisproject facility *Note 1

0 7.6-8.4 0.1-0.6NTU 0.2-0.6°F Normal

Water quality sent toBen Gardane district

*Note 2

0.85-0.95mg/liter 7.2-7.9 0.15-0.6NTU 113-123 °F Normal

Standard water qualityof Tunisia*Note 3

0.5-1.0mg/liter 6.5-8.5 3.0NTU 90°F

Nospecificstandard

Source: Collected data from SONEDE*Note1: Data at the end of 2017*Note2: Water quality data measured from 2015 to 2017 (minimum to maximum)*Note3: Standard water quality (NT09.14-2013)

Regarding the environmental monitoring system related to this project facility, the

Desalination Service of SONEDE is responsible. The field staff is patrolling and monitoring

around the facility every day. Although there has been no major negative impact on the

environment until now, if it occurs around the facility, it is supposed that the field staff reports

and shares information to the Regional Branch Office of Medenine Governorate of SONEDE to

respond to it.

2）Resettlement and Land Acquisition

According to SONEDE, the area of this project site as a whole is 160,000m2, of which

158,217m2 was a state-owned land not requiring payment of compensation. As the remaining

1,783m2of land was private land, SONEDE negotiated and processed acquisition procedure with

the holders, civilians, in accordance with the domestic law and paid for the expenses. The total

payment was 71,333 Tunisia Dinar (TND). The acquisition procedures and payments have

progressed smoothly. Since there were no residents in the site, relocation of residents was not

accompanied.

Regarding data of water supply and water quality to Ben Gardane district, the amount of daily

average water supply has reached the initial target value after the project was completed, while

the water quality, salinity, has not achieved the target value. As the background, the new deep

wells were developed by SONEDE to meet the water supply demand which is on an increasing

113-123 °F. However, no health damage or the like have occurred.

19

trend in the district. However, the salinity of water intake from these deep wells remains high

and the desalination treatment has not been done. As far as the desalination facility of this

project is concerned, the salinity concentration is lowered with the expected capacity 20 .

However, as the initial project objective was “improvement of water supply circumstances of

the whole district”, based on the set effect indicators and actual values, it cannot be said that the

degree of achievement at the time of ex-post evaluation is high. Based on the above, it is

considered that the effectiveness and impacts of the project are fair.

3.4 Sustainability (Rating: ③)

3.4.1 Institutional / Organizational Aspect of Operation and Maintenance

The executing agency of this project is SONEDE. The management and daily operation and

maintenance of the constructed facilities are carried out by the Desalination Service Station of

Ben Gardane District. At the time of ex-post evaluation, there are 5 staff members (breakdown:

1 chief, 2 technical management staffs, and 2 facility operation and maintenance staffs). The

work shift of the desalination facility is in a three-shift system, in 24-hour duty. In addition, the

operation and maintenance of this facility and equipment: replacement and cleaning of filter

cartridges, cleaning by chemicals, and applying grease to machine parts, etc, are carried out for

each item on a daily and a regular basis. From the interview to the Regional Branch Office of

Medenine Governorate of SONEDE, it is confirmed that the placement of staff is the right

person in the right job. Furthermore, it is considered to increase the number of staff for further

stable operation in the future.

The Regional Branch Office of Medenine Governorate of SONEDE, which is the upper

organization of the Service Station, is in charge of check, management and repair of the water

pumps connected to the desalination plant facilities. In addition, the Southern Regional Branch

Office of Sfax, which is further upper organization of the Branch Office, is in charge of

operation and maintenance and repair of each deep well in addition to the large-scale

overhauling of the facilities and equipment of the project.

From the above, it is considered that there is no particular big problem regarding the

institutional aspect of operation and maintenance at the time of ex-post evaluation.

20 In other words, it is not that there is no effect of this project. If this project were not implemented, it is clear thatthe water intake from the Marsa deep well and the Ourasnia deep well would have been distributed with even highersalinity concentration to Ben Gardane district.

20

3.4.2 Technical Aspect of Operation and Maintenance

The staff members belonging to the Desalination Service Station of Ben Gardane District, the

Regional Branch Office of Medenine Governorate and the Southern Regional Branch Office of

Sfax are regularly taking studies and trainings, handled by SONEDE headquarters, necessary

for operation and maintenance work. Such examples are the “Work improvement in desalination

facility site”, 10 participants, conducted in October 2016, and the “Remote water supply

network management”, 4 participants, conducted in March 2017. In addition, OJT for new staff

members is also implemented on a timely basis, and the contents concerning the operation of

pump facilities, the technical operation of desalination facility, and the remote control of water

supply network are handled. In the above organizations, it is confirmed that experienced staff

members are allocated at the right place through the questionnaire and the interview with the

staff. It is confirmed that the manual concerning the operation and maintenance of the project

facility has also been prepared in the Desalination Service Station of Ben Gardane District and it

is being utilized on a timely basis.

From the above, it is judged that there are no particular problems concerning the technical

aspect of operation and maintenance of the project.

3.4.3 Financial Aspect of Operation and Maintenance

Table 9 shows the operation and maintenance expenses (last 4 years) of the facilities and

equipment developed in the project. The operation budget is the budget amount required for

filter cartridges, osmotic membrane modules, and detergents, and the maintenance budget are

the budget amount required for water supply pumps and related accessories.

Table 9: Operation and Maintenance Budget of Facilities and EquipmentDeveloped by this Project

(Unit: Tunisian Dinar (TND))2014 2015 2016 2017

Operation Budget 12,000 65,000 10,000 45,000MaintenanceBudget - - 10,000 10,000

Source: SONEDE

According to SONEDE, regarding the increase and decrease of the opeartion budget, there

were the expenses for the periodic replacement of parts of the desalination plant. The reason

why the operation budget in 2015 increased in comparison with the previous year is due to the

21

expense to replace some parts of the osmotic membrane modules. The reason why the operation

budget in 2017 similarly increased in comparison with the previous year is due to the expense to

replace the filter cartridges. The operation budgets for 2014 and 2016 are mainly only the

expenditure required for cleaning detergents and cleaning works. Further, the reason why the

operation and maintenance budget did not occur before 2016 is that new facilities and

equipment after completion did not require work as they were new. From 2016 onwards, the

fixed amount is applied every year. According to the Desalination Service Station of Ben

Gardane District and the Regional Branch Office of Medenine Governorate, regarding the

operation and maintenance budget, there were such comments as “the necessary budget has

been appropriated for the operation and maintenance work every year. There has been no

shortage of works due to a budget shortage”.

Based on the above, it is judged that there are no particular problems related to the financial

aspect of the operation and maintenance of the project.

3.4.4 Status of Operation and Maintenance

At the time of the ex-post evaluation, the situation of the facilities and equipment maintained

in the project has no problem and there is no record of repairing. According to the Desalination

Service Station of Ben Gardane District, it is said that cases of actual incompleteness or damage

will be immediately responded. The daily, monthly, and annual inspections have been carried

out according to the contents of facilities and equipment. It is also confirmed that there were no

impacts on facilities and equipment due to natural disasters and no concern to the operation and

maintenance through the interview to the Station.

There is no problem in the storage and procurement status of spare parts. There is a

procurement system of supplies being done by local suppliers. There are track records that the

filters necessary for desalination have been delivered from the UK and the other RO membrane

related products have been delivered from South Korea.

Regarding the solar power generation systems, the operation and maintenance and cleaning

are properly carried out. The output is 210 kW, and it is functioning normally as an auxiliary

role of main power supply for related equipment in the desalination plant.

【About treated saline water by the solar evaporation pit and the RO membranes】

At the time of ex-post evaluation, the water level in the solar evaporation pit is kept stable.

However, the following circumstances have occurred with regard to the treated saline water by

22

the pit and the RO membrane from before implementation to after completion of the project.

1) In the initial design of the project, it was decided that the raw water (salt concentration

14g/liter) from the Marsa deep well was to be treated by the RO membrane, 70% is desalinated

(0.3g/liter) and 30% was to be concentrated wastewater (47g/liter), and the latter concentrated

wastewater of 30% was to be evaporated in the solar evaporation pit (Photo 3). Based on that

proportion, the scale of solar evaporation pit (11.9 ha) was also designed. However, SONEDE

has set the percentage of treated volume at the RO membrane as 64%:36% after operation of the

facilities, June 2013. This is because it was expected that the load on the desalination treatment

in the RO membrane could be mitigated by reducing the proportion from 70% to 64%. More

specifically, since the load is continuously applied to the filters and cartridges attached to the

RO membrane, there were concerns for the continuity of operation and maintenance in the

future, protection of the RO membranes and related attached equipment including purchase of

parts and the cost, and the possibility of not being able to treat smoothly and technically. As a

result, the proportion was declined to 64% and that of the highly-concentrated saline water sent

to the pit was raised to 36%. However, in that case, the rise of water level inside the pit (design

standard of 1.3m to maximum 1.7m) was concerned. The consultant of construction supervision

of the project expressed concerns about this SONEDE’s policy, the operation of pit in particular.

2）Before the start of the project, there was discussion among the concerned parties of the

project that the highly-concentrated saline water discharged by the treatment of the RO

membrane was to be drained through the drain pipe, about 1 km long from the desalination plant,

to the neighboring salt lagoon (Bhiret El Bibent, Photo 4).However, fishermen around the salt

lagoon expressed concerns to the drainage of the highly-concentrated saline water. However, as

a matter of fact, there was no big difference between the salinity concentration of the drained

and that of the salt lagoon, but the fishermen were concerned and opposed as they understood

that highly-concentrated saline water would flow into the salt lagoon, and therefore, the

agreement was not settled before the start of the project. Since the salt lagoon was also a place

registered in the Ramsar Convention21 in 2007, environmental clearance could not be obtained

from the administrative organization, “Organization for Protection and Development of Coastal

Region” (L'Agence de Protection et d'Aménagement du Littora (APAL)), which is responsible

for the environmental permission on coastal areas. Therefore, SONEDE suggested to develop

the solar evaporation pit before the start of the project. On the other hand, as mentioned above,

SONEDE focused setting the operation of the RO membrane as the proportion of 64%: 36%. As

21 The official title is the Convention on Wetlands of International Importance especially as Waterfowl Habitat.

23

a result, there was concern that the water level of the pit often rises, exceeding the designed

maximum water level of 1.58 m. Particularly when a strong wind blows, there is concern about

the possibility of overtopping from within the pit.

3) Amidst such concerns, an agreement on the drainage of saline water into the salt lagoon

between SONEDE, related organizations and the fishermen was established in the second half

of 2016. SONEDE and related organizations have held meetings with the fishermen a couple of

times and persistently explained that drainage to salt lagoons has a little negative impact (there

is no difference in the salinity concentration in drained water and in the water in salt lagoons)22,

and that it is based on the scientific evidence, and fishermen finally accepted. At the time of the

ex-post evaluation, the saline-treatment is carried out in the pit, but SONEDE has a policy to

drain via a drain pipe, about 1km long, into the salt lagoon in the near future23. In response to

this circumstance, in October 2016, SONEDE and JICA agreed on the two operating policies of

the above-mentioned 1) the drainage of saline water treated at the project facility to the salt

lagoon and 2) change of recovery rate of the RO membrane from 70% to 64%. In the near future,

drainage to the salt lagoon is scheduled to be carried out while utilizing the pit. At the time of

the ex-post evaluation, the water level of the pit is stably maintained at 1.3 m, and it is estimated

that if the drainage to the salt lagoon is realized in the future, the burden on operation and

maintenance will be further reduced. Either way, as of the time of the ex-post evaluation, no

particular problems have occurred in the pit.

From the above, there are no problems in the institutional, technical and financial aspects of

the operation and maintenance. Therefore sustainability of the project effects is high.

22 As supplementary information, as for this matter, it was approved by the Tunisian Environmental ProtectionAgency (ANPE).23 At the time of the ex-post evaluation, about 500m of the drainage pipe has already been laid, and installation of theremaining about 500m will be advanced in the future.

Photo 4: Salt Lagoon (Bhiret El Bibent)Photo 3: Solar Evaporation Pit

24

4. Conclusion, Lessons Learned and Recommendations

4.1 Conclusion

This project constructed the desalination system of groundwater by reverse osmotic

membrane method to increase the amount of water supply and improve water quality, salinity

concentration, in Ben Gardane district in Medenine Governorate located in the coastal region of

southern Tunisia, and to contribute to stability of the living environment of residents around the

district. To raise water supply rate, to secure drinking water and to improve water quality in

urban and rural areas are presented in the 11th Socio-Economic Development Five-Year

Plan(2007-2011) formulated by the Tunisian government and the Five-year Development Plan

formulated by SONEDE. In addition, the development needs for expansion of water supply

demand around the district have been confirmed. It was also confirmed that this project was

relevant to Japan’s ODA policy. Therefore, its relevance is high. Regarding efficiency, the

outputs were largely as planned, and the project cost was also within the initial plan. On the

other hand, regarding the project period, it exceeded the initial plan as the construction of the

pump station by Tunisian side required the time to assemble the drilling equipment and to join

underground cable buried at the pumping station. Therefore, its efficiency is fair. Regarding the

quantitative effect indicators of the project such as data of supply and quality of water to Ben

Gardane district, after the completion of the project, the amount of daily average water supply

has reached the initial target amount, while the water quality, salinity, has not been achieved the

target. In addition, in the interview survey to residents around the district, there were dissatisfied

opinions that “salinity concentration was high, amount of water supply was low, and pressure of

water supply was low”, and additionally, it was confirmed that the non-revenue water rate in the

district was also high. Thus, it is assumed that its impact is limited. Therefore, its effectiveness

and impacts of this project are fair. There is no particular concern in terms of institutional,

technical and financial aspects of the Desalination Service Station of Ben Gardane District,

Regional Branch Office of Medenine Governorate, and Southern Regional Branch Office of

Sfax which are responsible for the operation and maintenance of this project. There is no

particular problem in the operation and maintenance status of other facilities and equipment.

Therefore, the sustainability of effects developed by the project implementation is high.

In light of the above, the project is evaluated to be satisfactory.

25

4.2 Recommendations

4.2.1 Recommendations to the Executing Agency

It is desirable that SONEDE take measures on the actual condition of water leakage in Ben

Gardane district. Because even if SONEDE takes the measures to increase the amount of water

supply based on the demand of water supply, unless water is distributed without leakage to each

home or the commercial facilities of end users, it cannot be said that safe and reliable water

supply is carried out. At the time of the ex-post evaluation, SONEDE is implementing PNAQ2

aiming at lowering the salinity concentration and increasing the amount of water supply, and in

addition, it is recommended to make efforts to improve the non-revenue water rate in the

district.

4.2.2 Recommendations to JICA

None.

4.3 Lessons Learned

Importance of obtaining consensus among concerned parties

As of the time of the ex-post evaluation, there is no particular problem in the solar evaporation

pit. On the other hand, if it could take time, it is thought that the environmental clearance by

having consultations among the project related parties should have been obtained before the start

of the project, concerning drainage to the salt lagoon. Thus, it is thought that focusing on

consensus formation as much as possible about wastewater treatment of highly concentrated salt

water was desirable. Although it may not be easy to obtain consensus among the related parties

including local residents, in a similar project in the future, when one is aiming to reduce concerns

of the side who is responsible for operation and maintenance, it is meaningful to have an

agreement steadily by taking as much time as possible.

26

2012☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)/Total m onthly production (㎥))

January 153,368 73,569 12,073 239,010 3 0.9 10.5February 139,951 61,609 12,473 214,033 3 0.9 10.5

March 150,774 62,279 11,827 224,880 3 0.9 10.5April 153,781 82,996 12,452 249,229 3 0.9 10.5May 164,791 101,231 12,960 278,982 3 0.9 10.5June 164,069 121,710 12,528 298,307 3 0.9 10.5July 161,838 113,199 13,500 288,537 3 0.9 10.5

August 171,875 126,333 12,450 310,658 3 0.9 10.5September 136,980 105,961 11,250 254,191 3 0.9 10.5

October 167,031 112,095 8,560 287,686 3 0.9 10.5November 162,278 108,397 9,089 279,764 3 0.9 10.5December 146,123 98,946 9,619 254,688 3 0.9 10.5

Annualaverage

Source:Sum m arized based on SO NED E dataRem arks:Although the salinity content(g / liter)ofeach w atersource in the table is notm easured periodically,itis nearly constant.

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach w atersource(g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

M onthlyproduction

total(㎥)

2.72.82.82.72.62.52.52.42.52.42.42.5

2.6

July,2013☆Calculation form ula for salinity concentration =((A)*(1)+(B )*(2)+(C )*(3)+(D)*(4))/Total m onthly production (㎥))

July 147,818 108,033 9,159 47,094 312,104 3 0.9 9 0.3

Source:Sum m arized based on SO NED E data ↑This project

(→Ifnotim plem ented,itexceeds 4.0 g/liter.)

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

SDBG（D)

2.0

Salinity contentofeach w atersource (g/litter)

M onthlyproduction

total(㎥)

※Supplem entary inform ation:Iftheprojectis notim plem ented,14 g/liter

M onthly production(* Itis notpeak production am ount)

Salinity concentrationSoutherndistributionnetwork

(1)

M aouna(2)

Sayah(3)

SDBG(4)

Rem arks:Although the salinity content(g / liter)ofeach watersource in the table is notm easured periodically,itis nearly constant.

Appendix: Table 5 Basis for Calculating Water Quality (Salinity)

January - June,2013☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C)*(3)/Total m onthly production (㎥))

January 162,757 93,100 9,619 265,476 3 0.9 9February 144,741 75,184 9,619 229,544 3 0.9 9

March 168,901 111,589 10,523 291,013 3 0.9 9April 158,971 100,216 10,835 270,022 3 0.9 9May 171,067 114,565 10,051 295,683 3 0.9 9June 164,784 131,084 10,641 306,509 3 0.9 9

6 m onths average

Source:Sum m arized based on SO NED E data

Rem arks:Although the salinity content(g / liter)ofeach w atersource in the table is notm easured periodically,itis nearly constant.

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach w atersource(g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

2.3

2.4

M onthlyproduction

total(㎥)

2.52.62.42.52.4

27

August - Decem ber,2013☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)+(D )*(4)+(E)*(5)/Total m onthly production (㎥))

August 159,493 116,055 10,124 46,273 36,000 367,945 3 0.9 9 0.3 10.5September 149,388 104,961 10,358 40,386 34,158 339,251 3 0.9 9 0.3 10.5

October 150,622 105,361 10,052 45,078 39,558 350,671 3 0.9 9 0.3 10.5November 138,620 98,253 9,832 44,024 19,310 310,039 3 0.9 9 0.3 10.5December 121,776 95,587 9,947 45,394 6,000 278,704 3 0.9 9 0.3 10.5

5 m onths average

Source:Sum m arized based on SO NED E data ↑This projectR em arks:Although the salinity content(g / liter)ofeach w ater source in the table is not m easured periodically,it is nearly constant. ※Supplem entary inform ation:Ifthe projectis not

im plem ented,14 g/liter

(→Ifnotim plem ented,it exceeds 4.0 g/literon average 5 m onths.)

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach watersource (g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

SDBG（D)

O urasniadeep well

(E)

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

SDBG(4)

O urasnia(5)

2.8

M onthlyproduction

total(㎥)

2.93.03.02.62.2

2014☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)+(D )*(4)+(E)*(5)/Total m onthly production (㎥))

January 132,522 104,995 14,763 36,427 3,165 291,872 3 0.9 9 0.3 10.5February 131,085 102,421 14,823 9,491 0 257,820 3 0.9 9 0.3 10.5

March 154,163 102,668 13,578 27,136 0 297,545 3 0.9 9 0.3 10.5April 160,319 93,145 13,964 43,789 20,880 332,097 3 0.9 9 0.3 10.5May 154,304 102,068 13,547 45,271 23,022 338,212 3 0.9 9 0.3 10.5June 154,787 105,228 13,283 43,269 39,060 355,627 3 0.9 9 0.3 10.5July 171,055 121,002 13,280 49,855 38,102 393,294 3 0.9 9 0.3 10.5

August 162,922 111,724 14,005 48,351 38,000 375,002 3 0.9 9 0.3 10.5September 188,793 105,153 13,220 47,715 37,448 392,329 3 0.9 9 0.3 10.5

October 160,098 107,383 13,182 50,029 37,001 367,693 3 0.9 9 0.3 10.5November 153,847 105,174 12,952 49,609 20,700 342,282 3 0.9 9 0.3 10.5December 165,000 105,708 12,173 39,105 14,040 336,026 3 0.9 9 0.3 10.5

A nnual average

Source:Sum m arized based on SO NED E data ↑This project

R em arks:Although the salinity content(g / liter)ofeach w ater source in the table is not m easured periodically,it is nearly constant.

(→Ifnotim plem ented,itexceeds 4.0 g/liter.)

※Supplem entary inform ation:Ifthe projectis notim plem ented,14 g/liter

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach watersource (g/litter)

Salinity concentrationin each m onth

O urasniadeep well

(E)

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

SDBG(4)

O urasnia(5)M onthly

productiontotal(㎥)

2.62.6

2.8

3.12.93.03.03.0

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

2.8

SDBG（D)

2.32.42.32.8

2015☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)+(D )*(4)+(E)*(5)/Total m onthly production (㎥))

January 133,446 110,136 1,837 28,077 0 273,496 3 0.9 9 0.3 10.5February 135,254 96,406 70 24,704 10,030 266,464 3 0.9 9 0.3 10.5

March 176,405 96,375 27,074 9,659 309,513 3 0.9 9 0.3 10.5April 151,206 109,743 1,998 27,117 39,000 329,064 3 0.9 9 0.3 10.5May 165,803 110,586 2,784 45,580 27,359 352,112 3 0.9 9 0.3 10.5June 154,787 110,969 2,550 46,643 32,258 347,207 3 0.9 9 0.3 10.5July 180,684 96,733 2,781 48,067 51,487 379,752 3 0.9 9 0.3 10.5

August 152,499 107,969 1,500 45,369 46,661 353,998 3 0.9 9 0.3 10.5September 167,383 99,880 10,427 44,228 38,661 360,579 3 0.9 9 0.3 10.5

October 163,045 106,671 3,393 35,911 43,810 352,830 3 0.9 9 0.3 10.5November 142,324 105,639 25,811 28,728 302,502 3 0.9 9 0.3 10.5December 134,931 119,026 21,204 30,915 306,076 3 0.9 9 0.3 10.5

A nnual average

Source:Sum m arized based on SO NED E data ↑This project

R em arks:Although the salinity content(g / liter)ofeach w ater source in the table is not m easured periodically,it is nearly constant.

(→Ifnotim plem ented,itexceeds 4.0g/liter.)

※Supplem entary inform ation:Ifthe projectis notim plem ented,14 g/liter

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach watersource (g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

SDBG（D)

O urasniadeep well

(E)

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

SDBG(4)

O urasnia(5)

M onthlyproduction

total(㎥)

1.92.32.33.02.62.73.23.03.13.12.72.8

2.8

28

2016☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)+(D )*(4)+(E)*(5)/Total m onthly production (㎥))

January 133,446 120,007 22,095 39,066 314,614 3 0.9 9 0.3 10.5February 138,670 100,301 23,398 41,746 304,115 3 0.9 9 0.3 10.5

March 144,618 103,438 29,684 44,900 322,640 3 0.9 9 0.3 10.5April 144,600 104,963 7,183 42,940 40,528 340,214 3 0.9 9 0.3 10.5May 161,320 108,568 9,930 43,665 40,752 364,235 3 0.9 9 0.3 10.5June 166,156 100,424 10,687 42,733 39,212 359,212 3 0.9 9 0.3 10.5July 179,276 110,049 10,034 42,614 37,254 379,227 3 0.9 9 0.3 10.5

August 172,889 111,112 9,723 43,736 40,000 377,460 3 0.9 9 0.3 10.5September 161,300 109,409 5,137 42,785 43,215 361,846 3 0.9 9 0.3 10.5

October 156,169 108,783 43,849 44,059 352,860 3 0.9 9 0.3 10.5November 170,835 108,280 41,038 42,921 363,074 3 0.9 9 0.3 10.5

December 158,276 108,082 25,993 46,615 338,966 3 0.9 9 0.3 10.5 A nnual average

Source:Sum m arized based on SO NED E data ↑This project

R em arks:Although the salilinity content (g / liter)ofeach watersource in the table is notm easured periodically,itis nearly constant.

(→Ifnotim plem ented,itexceeds 4.0g/liter.)

※Supplem entary inform ation:Ifthe projectis notim plem ented,14 g/liter

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach watersource (g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna deepwell(B)

Sayah deepwell(C )

SDBG（D)

O urasniadeep well

(E)

Southerndistributionnetwork

(1)

M aouna(2)

Sayah(3)

SDBG(4)

O urasnia(5)

M onthlyproduction

total(㎥)

2.93.13.13.03.13.13.03.03.03.03.0

3.2

3.0

-August,2017☆Calculation form ula for salinity concentration =((A )*(1)+(B )*(2)+(C )*(3)+(D )*(4)/Total m onthly production (㎥))

January 158,097 105,668 35,481 40,500 339,746 3 0.9 0.3 9February 145,146 91,690 37,763 38,707 313,306 3 0.9 0.3 9

March 172,070 113,316 41,537 43,983 370,906 3 0.9 0.3 9April 162,265 118,836 28,473 36,721 346,295 3 0.9 0.3 9May 168,408 127,816 41,124 43,746 381,094 3 0.9 0.3 9June 168,408 125,816 41,251 42,600 378,075 3 0.9 0.3 9July 181,709 124,293 39,624 43,490 389,116 3 0.9 0.3 9

August 184,709 127,010 41,652 44,095 397,466 3 0.9 0.3 98 m onths average

Source:Sum m arized based on SO NED E data ↑This project

Rem arks:A lthough the salilinity content (g / liter)ofeach w ater source in the table is not m easuredperiodically,it is nearly constant.

※Supplem entary inform ation:Ifthe projectis notim plem ented,14 g/liter

(→Ifnot im plem ented,it exceeds 4.0 g/liter on average 8 m onths.)

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach w atersource (g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna &Jalleldeep

wells(B)

SDBG( C )

O urasniadeep well

(D)

Southerndistributionnetwork

(1)

M aouna(2)

SDBG(3)

O urasnia(4)

M onthlyproduction

total(㎥)

2.82.82.82.72.72.72.72.7

2.7

Septem ber,2017 -☆Calculation form ula for salinity concentration =((A)*(1)+(B)*(2)+(C)*(3)+(D)*(4)/Total m onthly production (㎥))

Septem ber 163,296 127,010 26,089 11,865 328,260 3 0.9 0.3 9O ctober 168,585 120,834 0 29,241 318,660 3 0.9 0 0.135Novem ber 166,723 122,151 0 27,347 316,221 3 0.9 0 0.135Decem ber 171,584 122,287 0 28,678 322,549 3 0.9 0 0.135

4 m onths average

Source:Sum m arized based on SO NED E data ↑This project ↑This project

- Early Sept. M id Sept.-

(→Ifnotim plem ented,itexceeds 2.9 g/literon average 4 m onths.)

※Supplem entary inform ation:Ifthe projectis notim plem ented,SDBG is 14 g/literand O urasnia is 9g /liter.

Rem arks:Although the salilinity content(g / liter)ofeach watersource in the table is notm easured periodically,itis nearly constant.

M onthly production(* Itis notpeak production am ount)

Salinity contentofeach w atersource (g/litter)

Salinity concentrationin each m onth

M onth

Southerndistributionnetwork

(A)

M aouna &Jalleldeep

wells(B)

SDBG( C )

O urasnia deepwell(D)

Southerndistributionnetwork

(1)

M aouna(2)

SDBG(3)

O urasnia(4)

M onthlyproduction

total(㎥)

2.22.02.02.0

2.1

1

Kingdom of Morocco FY2017 Ex-Post Evaluation of Japanese ODA Loan

“Watershed Management Project” External Evaluator: Maki Hamaoka

Foundation for Advanced Studies on International Development 0. Summary

The objective of this project was to restore degraded lands and improve the livelihood of the local population by carrying out afforestation and livelihood improvement activities in Oued Mellah Watershed in the regions of Chaouia Ourdigha (hereinafter called “OM Watershed”) and Allal El Fassi Dam Upper Watershed in the region of Fès-Boulemane (hereinafter called “AEF Dam Upper Watershed”), thereby contributing to natural resources conservation and to poverty alleviation of the local population in the above two regions.

The project has been highly relevant to the development plan and development needs of Morocco, as well as Japan’s ODA policy; therefore its relevance is high. Among the three operation and effect indicators, those of afforestation area and quantity of planting achieved their target values sufficiently. The actual value of the survival ratio after planting was greatly different from year to year. In the year when the survival ratio was low, external factors such as the influence of exceptional drought greatly affected the survival ratio after planting. In this regard, the achievement degree was judged to be fair. Positive impacts were recognized such as an increase in income and diversification of income sources brought by the livelihood improvement activities and a decrease in the quantity of forest resources collected and illegal logging as a result of change in consciousness of the local population through awareness-raising activities and livelihood improvement activities. No negative impact on the natural environment was observed and there was no resettlement. Among the operation and effect indicators, those of afforestation area and quantity of planting indicate the achievement result at a certain “point” whereas the survival ratio after planting indicates the degree of afforestation after a certain “period”. In this ex-post evaluation, as a result of placing importance on the survival ratio after planting, the effectiveness/impact was judged to be fair. Although the project cost was within the plan, the project period slightly exceeded the plan; therefore the efficiency of the project is fair. In sustainability, with regard to the institutional/organizational aspects, the organizational structure of the executing agency, the High Commissariat for Water and Forest and Combating Desertification (hereinafter called “HCEFLCD” 1 ) is maintained at central, regional and provincial levels from the appraisal to the ex-post evaluation. In technical aspects, the executing agency conducts monitoring after afforestation, and maintenance of check dams and filter fences without problems. There is no problem in financial aspects. Therefore, sustainability of the project effects is high. 1 Haut Commissariat aux Eaux et Forêts et à la Lutte Contre la Désertification

2

In light of the above, this project is evaluated to be satisfactory.

1. Project Description

Project Location(s) Forest improved by the Project

(Benslimane Province in the OM Watershed, Thuja)

1.1 Background In Morocco, where territory is situated in arid and semi-arid zones, forest degradation was

equivalent to 30,000 hectares annually, whereas the total forest area of the country was 9 million hectares2. Land degradation is caused mainly by climate change and human pressure such as overgrazing. The forest degradation caused soil erosion and degradation, as well as degraded water and soil conservation functions of lands. Although the government of the Kingdom of Morocco has implemented afforestation and dam construction, the forest degradation is one of the causes of floods in urban area in the downstream. In recent years especially, sudden heavy rains have occurred frequently, causing frequent floods in urban areas downstream. Not only physical damage but also loss of human life has become a problem

along with the progress of urbanization. In Morocco, since the rainfall is low throughout the year and human pressure such as overgrazing is high, once natural recovery capacity is lost, it becomes very difficult to restore lost forest naturally. The government of the Kingdom of Morocco considers forest conservation and water and soil protection as urgent issues. 1.2 Project Outline

The objective of this project was to restore degraded land and improve the livelihood of the local population by carrying out integrated watershed conservation activities such as afforestation and livelihood improvement activities of the local population in the OM Watershed in the region of Chaouia Ourdigha and AEF Dam Upper Watershed in the region of Fès-Boulemane, thereby contributing to natural resources conservation and to poverty alleviation in the above two regions. 2 Data provided by the government of Morocco at the time of the appraisal (document provided by JICA).

3

Loan Approved Amount/ Disbursed Amount 3,165 million yen/1,793 million yen

Exchange of Notes Date/ Loan Agreement Signing Date March 2007/March 2007

Terms and Conditions

Interest Rate 0.75% Repayment Period

(Grace Period) 40 years

(10 years) Conditions for Procurement General Untied

Borrower / Executing Agency

Government of the Kingdom of Morocco/ HCEFLCD

Project Completion December 2014

Main Contractor(s) (Over 1 billion yen) Vakakis International S.A. (Greece)

Related Studies (Feasibility Studies, etc.)

Kingdom of Morocco “Special Assistance for Project Formulation for the Watershed Management Project” (JICA, November 2006)

Related Projects

Watershed management projects by other organizations

Watershed Area (km2) Organization Mohamed V 49,920 EU Ouahda 6,153 EU Hassan I 1,670 IBRD Moulay Youssef 1,441 UNDP, FAO Idriss I 3,680 AFD Aoulouz 4,500 AFD Nakhla 107 USAID

2. Outline of the Evaluation Study

2.1 External Evaluator Maki Hamaoka, Foundation for Advanced Studies on International Development

2.2 Duration of Evaluation Study

This ex-post evaluation study was conducted with the following schedule. Duration of the Study: September 2017 - December 2018 Duration of the Field Study: January 7- 19, 2018, April 22 - 26, 2018

2.3 Constraints during the Evaluation Study The operation and effect indicators and the target values of the outputs of this project were

revised at the time of the mid-term review in 2011. At this time, the extension of the project activities was not decided and the target year of the operation and effect indicators was 2015, two years after the planned project completion. However, despite the fact that the operation and effect indicators on afforestation area and quantity of planting3 reached their target values in the 3 Since the data on the survival ratio of one year after planting is only available as data on the survival ratio after

4

OM Watershed in 2012 and in the AEF Dam Upper Watershed in 2013, their target values were not revised. In addition, when the one-year extension of the activities was decided from December 2013 to December 2014, the revision of the target values to be achieved two years after the project completion year, namely 2016, was not conducted.

Since it was difficult to assume target values from interviews with concerned parties or information obtained from existing documents in this ex-post evaluation and there were no alternative data, the target values revised in 2011 to be targeted for 2013 and the actual result at the time of the project completion (2014) were compared in comparing the planned and actual results in efficiency. In evaluating effectiveness, the target values revised in 2011, for which the target year was 2015, and the actual result as of 2016 were compared. 3. Results of the Evaluation (Overall Rating: B4)

3.1 Relevance (Rating: ③5) 3.1.1 Consistency with the Development Plan of Morocco

The government of the Kingdom of Morocco placed high priority on watershed management at the time of the project appraisal. It formulated the “National Forest Program” (1998-2020) as the top strategy of the forest management policy, which set out a comprehensive strategy centered on “forest management as national property,” “development around forest areas,” “participatory approach for regional development” and “strengthening partnerships.” As an implementation plan in line with these strategies, the “National Watershed Management Plan” (1996) (hereinafter referred to as “PNABV”6) was formulated. The PNABV planned watershed management of approximately 1.5 million hectares in the 20-year period out of 10 million hectares of watershed with heavy erosion damage. The AEF Dam Upper Watershed and the OM Watershed, target watersheds of this project, were positioned in 7th and 22nd places respectively in the priority order of 22 target watersheds of the PNABV.

The government of the Kingdom of Morocco placed high priority on the watershed management at the time of the ex-post evaluation. Since the PNABV formulated in 1996 covered only 50% of the target area in 20 years, the result of the PNABV was reviewed and a concrete program has been formulated as the second phase of PNABV from 2016 to 2018 with a view to strengthening further watershed management. Moreover, “Law 113-13 on Pastoral Transhumance and Management and Development of Pastoral Spaces”7 was enacted in March 2016. The law sets out the basic principles and general rules on management of pastoral and sylvopastoral areas, use and development of pastoral resources, and pastoral transhumance and planting, the operation and effect of the project is evaluated in a limited range / time mainly from the operational status. 4 A: Highly satisfactory, B: Satisfactory, C: Partially satisfactory, D: Unsatisfactory 5 ③: High, ②: Fair, ①: Low. 6 Plan National d’Aménagement des Bassins Versants. 7 Loi sur la Transhumance Pastorale et la Gestion et l’Aménagement des Espaces Pastoraux113-13.

5

livestock mobility. The above law was enacted due to the fact that in Morocco, where rainfall is low (including the project area), together with the recent prolonged drought, overgrazing was the impetus to maintain forest resources and that institutional strengthening was an urgent issue.

As mentioned above, at the times of the appraisal and ex-post evaluation, the objectives of

the project aiming at restoring degraded land and improving the livelihood of the local population by comprehensive watershed conservation activities were highly consistent with the national development plan of Morocco.

3.1.2 Consistency with the Development Needs of Morocco (1) Trends in Forest Area

At the time of the project appraisal, the forest area of Morocco was 5,401 thousand hectares, which was increasing year by year. The forest area is 5,632 thousand hectares at the time of the ex-post evaluation, which increased from the time of the project appraisal, but it has been decreasing since 2010, looking at the annual change of forest area. The decline of the forest area is caused by climate change including long-term drought, collection of firewood by the local population (three to four times of potential), overgrazing (two to five times of potential), expansion of cultivated land and urbanization8.

Table 1. Trends in Forest Area in Morocco

Year 1990 2000 2005 2010 2015 1990－2000 % 2000－2010 % 2010-2015 %Area (1000hectares)

4,954 4,993 5,401 5,672 5,632 3.9 0.1 1.3 1.3 -8 -0.1

Forest area (1000 hectares) Auunal change of forest area (1000 hectares/year)

Note: The above-mentioned forest area is based on the definition of the Food and Agriculture Organization (FAO) of the United Nations. Source: Evaluation des ressources forestières mondiales 2015, rapport national, Maroc (2014).

(2) Occurrence of Floods

At the time of the project appraisal, the decline of the forest area caused soil erosion and deteriorated the water and soil conservation function of the land, becoming one of the causes of the flooding in the downstream urban areas. Among them, the large flood that occurred in the lower area of the OM Watershed in 2002 caused 63 deaths and large-scale damage, such as house inundation and disruption of roads in Mohammedia City and Berchid City. According to the interview survey conducted in Boulemane Province in the AEF Dam Upper Watershed at the time of the ex-post evaluation, the need for watershed management was recognized. The occurrence of damage to agricultural lands and livestock due to floods was reported where afforestation and installation of check dams and filter fences were not implemented, and afforestation and installation of check dams and filter fences for watershed conservation were 8 Evaluation des ressources forestières mondiales 2015, rapport national, Maroc (2014).

6

requested by the local population for places without afforestation and installation of check dams and filter fences.

(3) Poverty Incidence

The poverty incidence was 16.8% on average in the targeted eight rural communes of the OM Watershed and 24.0% on average in the 12 targeted rural communes in the AEF Dam Upper Watershed at the time of the project appraisal. At the time of the ex-post evaluation, the poverty incidence is 9.5% on average in rural areas and 1.6% on average in urban areas in Morocco9. Rural poverty incidence is significantly higher than urban poverty incidence. At the time of the ex-post evaluation, the poverty incidence is 7.6% on average in the OM Watershed and 11.1% on average in the AEF Dam Upper Watershed. At the time of the ex-post evaluation, compared to the time of the project appraisal, the poverty incidence of six out of eight rural communes in the OM Watershed and three out of 12 rural communes in the AEF Dam Upper Watershed are lower than the average of the rural poverty incidence (9.5%). Although the poverty incidence improved in most of the target rural communes, the need for further livelihood improvement is recognized in around half of the target rural communes.

Table 2. Poverty Incidence in the Project Area

OM Watershed 2014*2

Povertyincidence (%)

Population Povertyincidence (%)

Population

Khouribga 1 Lagnadi 19.3 7,338 15.0 7,2272 Ahlaf 19.8 12,841 4.7 11,4513 Mellila 18.9 14,257 4.6 15,0814 Lakhzazra 13.7 8,673 6.1 8,5825 M'Garto 12.5 8,827 2.3 8,5146 Ouled Cebbah 13 8,367 2.5 7,6067 Ouled M'Hamed 22 10,844 21.4 10,1878 Sidi Dahbi 14.9 7,925 4.0 8,703

Total 79,072 77,351Average 16.8 7.6

AEF Dam Upper Watershed1 Talzemt 29.0 3,710 10.6 3,1602 Ait Bazza 32.6 3,480 13.7 2,9553 Ait El Mane 27.4 2,243 12.0 1,9274 El Mers 31.4 5,891 10.7 5,1525 Sekoura 27.4 8,713 13.3 8,4626 Gguigou 47.2 7,976 14.4 21,6077 Ighzrane 17.9 1,150 9.2 9,6268 Oulad Mkoudou 18.9 7,821 4.1 6,6679 Dar El Hamra 10.5 4,022 11.9 4,01810 Tafajight 10.1 2,047 13.7 1,69711 Adrej 14.2 2,236 8.9 1,70912 Tazouta 20.8 5,745 11.1 1,354

Total 55,034 68,334Average 24.0 11.1

Settat

Boulemane

Sefrou

Benslimane

Province Rural Commune2005*1

Note: Gray shaded rural communes are those below the national average of rural poverty incidence. Source: *1 Pauvreté, développement humain et dévelopment social au Maroc, Haut Commisariat du Plan (2005). *2 Carte de la pauvreté communale 2014 (2014).

9 Haut-Commisariat au Plan et la Banque Mondiale (2017).

7

At the times of both the appraisal and ex-post evaluation, the objectives and approach of

the project were in line with the development needs of Morocco.

3.1.3 Consistency with Japan’s ODA Policy At the time of the project appraisal, the “Medium-Term Strategy for Overseas Cooperation

Operations” (2005-2007) of JICA focused on “assistance for poverty reduction” and “assistance for global issues and peacekeeping” as overall priority areas. The assistance policy for Morocco included “measures to environmental problems” as a priority area. The “Country Assistance Implementation Policy” (2006) of JICA focused on the importance of afforestation from the viewpoint of addressing environmental problems and water resources management. It stated assistance for comprehensive protection and recovery of forest resources as measures against forest degradation, soil erosion, and desertification caused by deforestation and overgrazing.

In the light of the above, this project has been highly relevant to Morocco’s development

plan, development needs, as well as to Japan’s ODA policy; therefore its relevance is high.

3.2 Efficiency (Rating: ②) 3.2.1 Project Outputs

The project outputs consisted of six components: (1) reconstruction of degraded forest ecosystem, (2) grazing and cultivated lands improvement, (3) treatment of lands affected by rill and gully erosion, (4) forest infrastructure improvement, (5) local population livelihood improvement and (6) equipment for institutional strengthening.

(1) Component 1: Reconstruction of Degraded Forest Ecosystem

This component is mainly composed of such activities as assisted regeneration10 and afforestation for protection11. As shown in Table 3, all activities were carried out as planned.

10 Reproductive planting of tree species in each target forest, which is the main constituent species of forest for regeneration (documents provided by JICA). 11 Afforestation to increase the permeability of water to soil by increasing vegetation cover in forest where devastation has progressed and alleviating soil erosion due to rainwater. Planting is done at a relatively high density. For the high density planting, items 1-5 in Table 3, the staircase work and the stone framework were constructed along the contour line in the site where the trees are planted (documents provided by JICA).

8

Table 3. Result of Component 1: Reconstruction of Degraded Forest Ecosystem (accumulation)

2008 2009 2010 2011 2012 2013 20141-1 Assisted regeneration

OM Watershed ha 1,200 200 400 850 1,150 1,350 1,350 1,450AEF Dam Upper Watershed ha 1,879 100 250 450 1,150 1,800 2,200 2,406

Total ha 3,079 300 650 1,300 2,300 3,150 3,550 3,8561-2 Afforestation for protection

OM Watershed ha 2,690 270 820 870 1,390 1,890 2,390 2,610AEF Dam Upper Watershed ha 3,675 500 1,100 1,600 2,400 3,100 3,850 3,950

Total ha 6,365 770 1,920 2,470 3,790 4,990 6,240 6,5601-3 Tending of plantation

OM Watershed ha n.a. 600 1,240 2,140 2,740 3,620 4,250 4,960AEF Dam Upper Watershed ha n.a. 700 900 1,550 2,400 3,220 3,920 3,920

Total ha 9,358 1,300 2,140 3,690 5,140 6,840 8,170 8,8801-4 Sylvicultural works (AEF DamUpper Watershed only)

ha 1,372 0 223 523 775 1,225 1,325 1,925

1-5 High density plantations (OMWatershed only)

ha 300 0 100 300 300 300 300 300

1-6 Forest management study ha 40,000 0 37,847 37,847 37,847 59,237 59,237 59,237

Unit Target Result

Note: The target value is the value revised at the time of mid-term review in 2011. Source: HCEFLCD. (2) Component 2: Grazing and Cultivated Lands Improvement

In Morocco, overgrazing is a major cause of the deforestation. This component was implemented to improve productivity of grazing lands and to suppress overgrazing in forests. For grazing lands improvement, the following were implemented as planned: 1) sylvopastoral plantations 12 and 2) regeneration of natural grazing lands 13 , and for cultivated lands improvement, 3) fruit tree plantation14 , 4) soil improvement15 , and 5) hydro-agricultural management.

12 Grasses were planted with reduced crown density by tree thinning so that plants can grow in closed forests. In the forestland with low crown density, trees for manure were planted and grazing lands were sowed in order to improve the productivity of livestock fodder. These activities were implemented after consultation with local residents with rights to grazing in the area (documents provided by JICA). 13 Regeneration of natural grazing lands, unlike the sylvopastoral plantations, was implemented by placing a guard for a certain period of time to prevent livestock invasion. In the devastated natural grazing lands, regeneration was assisted by fertilization and seeding. The project planned to decide on a grazing ban period through consultation with local residents who have the right to grazing, considering the situation of the grazing lands (documents provided by JICA). 14 Fruit trees such as olives, almonds and figs were planted according to the geographical conditions and the intention of the landowners for the purpose of increasing the vegetation covering and allowing landowners to earn income from the fruits (documents provided by JICA). 15 Work to improve the agricultural productivity of the land by removing stones from the ground and then constructing masonry along the contour lines (documents provided by JICA).

9

Table 4. Result of Component 2: Grazing and Cultivated Lands Improvement (accumulation)

2008 2009 2010 2011 2012 2013 20142-1 Slyvopastoral plantations

OM Watershed ha 984 0 400 550 780 1,030 1,260 1,260AEF Dam Upper Watershed ha 2,255 200 500 800 1,240 1,390 1,390 1,390

Total ha 3,239 200 900 1,350 2,020 2,420 2,650 2,6502-2 Regeneration of natural grazing lands

OM Watershed ha 2,748 500 1,300 1,988 2,288 2,438 2,448 2,748AEF Dam Upper Watershed ha 1,512 0 0 0 385 675 725 875

Total ha 4,260 500 1,300 1,988 2,673 3,113 3,173 3,6232-3 Fruit tress plantation

OM Watershed ha n.a. 205 605 725 1,145 1,515 1,655 1,810AEF Dam Upper Watershed ha n.a. 200 800 1,250 1,750 2,050 2,500 2,700

Total ha 4,600 405 1,405 1,975 2,895 3,565 4,155 4,5102-4 Soil improvement (AEF Dam Upper Watershed) ha 471 25 75 125 165 305 465 5052-5 Hydro-agricultural management (AEF Dam UpperWatershed)

site 6 1 3 4 5 6 7 7

TargetUnitResult

Source: HCEFLCD.

(3) Component 3: Treatment of Lands Affected by Rill and Gully Erosion

In this component, in order to suppress the outflow speed in places where there are no plants on a steep slope and where there is a lot of outflow of the surface soil, the following were implemented: 1) mechanical treatment (installation of check dams and filter fences); 2) maintenance/rehabilitation of check dams; and 3) biological treatment (afforestation around the check dams/fences). The actual result of mechanical treatment greatly exceeded the plan, since the mechanical treatment was highly appreciated by the local population and was implemented according to their requests on private lands that were not planned. The actual result of the maintenance/rehabilitation of check dams and filter fences was less than the plan due to the fact that the number of check dams and filter fences to be maintained decreased in the latter half of the project. As the quality of construction improved, the number of check dams and filter fences to be maintained decreased compared to the plan. The actual result of biological treatment was lower than the plan in the AEF Dam Upper Watershed due to the delay in construction caused by difficulty in selecting contractors.

Table 5. Result of Component 3: Treatment of Lands Affected

by Rill and Gully Erosion (accumulation)

2008 2009 2010 2011 2012 2013 20143-1 Installation of check dams and filter fences

OM Watershed m3 20,000 2,400 4,400 8,220 12,570 15,100 18,500 21,300AEF Dam Upper Watershed m3 29,100 3,100 6,500 10,500 17,500 23,500 37,395 41,486

Total m3 49,100 5,500 10,900 18,720 30,070 38,600 55,895 62,7863-2 Maintenance/rehabilitation of check dams and filter fences

OM Watershed site 800 0 0 170 406 541 841 841AEF Dam Upper Watershed site 755 0 70 70 159 159 264 264

Total site 1,555 0 70 240 565 700 1,105 1,1053-3 Biological treatment

OM Watershed ha 780 95 190 230 390 600 760 920AEF Dam Upper Watershed ha 430 0 0 5 90 175 275 355

Total ha 1,210 95 190 235 480 775 1,035 1,275

Unit Target Result

Source: HCEFLCD.

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(4) Component 4: Forest Infrastructure Improvement This component was composed of 1) nurseries improvement/production of seedlings and 2)

infrastructure of forest protection. The nurseries improvement and production of seedlings included production of seedlings, installation of irrigation facilities, light shielding nets and weather observation stations. The actual results of the nurseries improvement/production of seedlings exceeded the plan. The actual result of the production of seedlings was lower than the plan. The difference between the plan and the actual result was that the seedlings did not grow in the first half of the project because the seedlings were damaged during transportation due to inconsistency in the specifications of the rack for transportation. Another reason was because the number of seedlings to be produced was decided based on the afforestation plan of the next year and the actual required number decreased from the planned number.

In the infrastructure of forest protection, construction and maintenance of forest roads, maintenance of forest firebreaks (maintenance by reaping weeds and miscellaneous trees to protect plantation area from forest fires), and construction and maintenance of forest offices were implemented as planned. The actual result of construction and maintenance of forest roads and forest offices exceeded the plan as a result of implementation according to the needs. The actual result of maintenance of forest firebreaks was lower than the plan, because there was less need than expected.

Table 6. Result of Component 4: Forest Infrastructure Improvement (accumulation)

2008 2009 2010 2011 2012 2013 20144-1Nurseries4-1-1 Nurseries improvement

OM Watershed site 2 2 2 2 2 2 2 2AEF Dam Upper Watershed site 2 2 2 2 2 2 3 3

Total site 4 4 4 4 4 4 5 54-1-2 Production of seedlings

OM Watershed plant 7,203,900 0 2,550,000 4,187,900 5,647,900 6,692,900 7,440,577 7,754,377AEF Dam Upper Watershed plant 8,912,000 1,100,000 1,930,000 3,050,000 4,484,750 5,184,750 5,184,750 5,939,750

Total plant 16,115,900 1,100,000 4,480,000 7,237,900 10,132,650 11,877,650 12,625,327 13,694,1274-2 Infrastructures for forest protection4-2-1&4-2-2 Construction/Maintenance offorest road (total of the two target watersheds)

km 335 41 103 146 222 274 365 381

4-2-3 Maintenance of forest firebreaksOM Watershed site 8,400 400 600 1,600 2,400 6,400 10,400 14,400

AEF Dam Upper Watershed site 26,800 2,500 2,500 6,000 6,000 7,000 7,000 7,000Total site 35,200 2,900 3,100 7,600 8,400 13,400 17,400 21,400

4-3 Forest office installations4-3-1 Construction of forest offices site 2 2 2 2 2 2 2 24-3-2 Maintenance of forest offices

OM Watershed site 20 6 11 15 19 21 25 27AEF Dam Upper Watershed site 18 10 19 19 19 24 24 24

Total site 38 16 30 34 38 45 49 51

Unit Target Result

Source: HCEFLCD.

(5) Component 5: Local Population Livelihood Improvement This component consisted of the formulation and implementation of the Plan of

Development of Social Territorial Unit (Plan de Développement de Unités Socio-Territorials,

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herein after called “PDUST”)16 and the fish breeding study on the dam lake. The PDUST was formulated and implemented for the livelihood improvement of the local population and the living environment infrastructure development that complemented the forest conservation activities. The actual result of the number of rural communes which formulated and implemented the PDUST was 28 rural communes (nine in the OM Watershed and 19 in the AEF Dam Upper Watershed) as of 2014, against the planned 27 rural communes (eight in the OM Watershed and 19 in the AEF Dam Upper Watershed; target year was 2013). The fish breeding study on the dam lake was conducted as planned.

Table 7. Result of Component 7: Implementation of PDUST

Apiculture 21Agricultural training 15Construction/maintenance of roads 14Fruit trees plantation (olive, almond, etc.） 12Construction/rehabilitation of water points 12Construction/rehabilitation of small-scale irrigation 6Distribution of seeds of saffron 2Improvement of lands 1

Total 83

Item Number

Note: Since one organization developed and implemented multiple plans, the total number of items exceeds the total number of rural communes. Source: HCEFLCD.

(6) Component 6: Equipment for Institutional Strengthening

Vehicles and trucks (21 units), computer-related equipment (37 computers, three units of

computer-related equipment including software), and audio-visual equipment (20 units) were

purchased as planned.

Check dams constructed by the Project

(AEF Dam Upper Watershed, Sefrou Province)

Nurseries improved through the Project (OM Watershed, Ben Slimane Province)

16 At the beginning of the project, the name was PDD (Plan de Développement des Douars [village development plan]). In practice, since the plan was not formulated and implemented in a unit of one village (douar), but in a wider range of social territorial units (Unités Socio-Territoriales), the name was replaced by PDUST (Plan de

Développement de Unités Socio-Territorials; Social Territorial Unit Development Plan) in 2009. The contents being implemented are the same; PDUST was used in this report.

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3.2.2 Project Inputs 3.2.2.1 Project Cost With regard to the project cost, since the data on administration costs and price escalation

were not obtained at the time of the ex-post evaluation, the planned and actual project costs were compared by deducting those unavailable costs from the planned project cost. The actual project cost amounted to 2,249 million yen against the planned project cost of 3,596 million yen (equivalent to 63% of the planned project cost), which was within the plan (Table 8). The difference between the planned and the actual project cost was due to the fact that the unit cost was lower than the original estimate in the bid for selection of consultants to be engaged in the consulting services due to the influence of competition principle and the exchange rate fluctuation17. Additionally, compensation for the grazing ban was not expended in the OM Watershed due to the residents’ disagreement.

Table 8. Planned and Actual Project Cost Unit: Million yen

Item Plan Actual 1. Forest Conservation Activities 2,686 1,717

Reconstruction of degraded forest ecosystem 1,115 624 Grazing and cultivated lands improvement 434 237

Treatment of lands affected by rill and gully erosion 271 215 Forest infrastructure improvement 560 417

Local population livelihood improvement 209 153 Equipment for institutional strengthening 97 73

2. Price escalation 497 N.A. 3. Physical contingency 159 0 4. Consulting Services 156 75 5. Administration Costs 129 N.A. 6. Taxes and Duties 426 404 7. Compensation for grazing ban 169 51 8. Lifting charge 2

Total 4,222 2,249 Total excluding Item 2 and 5 3,596

Note: Gray-shaded parts were compared. Source: HCEFLCD

3.2.2.2 Project Period

The planned project period was 82 months, or from March 2007 (ODA loan signing) to December 2013 (completion of the watershed conservation activities). The actual project period was 94 months, or from March 2007 to December 2014 (equivalent to 115% of the original plan). The project period was slightly longer than planned18. The difference between the planned

17 The exchange rate used for planned cost: MAD 1: JPY 13.4. The lowest exchange rate was JPY 9.0 against 1 MAD. The exchange rate as of end of 2015 was 12.3 JPY against 1 MAD. The average for 2008 - 2013 was 11.16 JPY against MAD 1. 18 Regarding the project period, according to the Minutes of Discussions singed by JBIC and HCELCD on February

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and the actual period was because the loan disbursement rate was low as of 2013, and it was decided to continue the watershed conservation activities until December 2014 against the planned completion of December 2013 in order to promote the loan disbursement and to strengthen the output of the watershed conservation activities further, considering the remaining period of loan disbursement (which was November 2015). In fact, the extension of the water conservation activities increased the achievement level of most of the outputs.

3.2.3 Results of Calculations for Internal Rates of Return (Reference only) To calculate the Economic Internal Rate of Return (EIRR), the cost was defined as the

project cost necessary for the project implementation and the benefit was defined as the estimated additional value of the forest products increased by the project. The project life is 50 years. The EIRR of the appraisal was 11.08% and the EIRR re-calculated at the time of the ex-post evaluation was 13.5%. This was due to the fact that the most of the actual benefits were larger than planned.

In light of the above, although the project cost was within the plan, the project period exceeded the plan. Therefore, efficiency of the project is fair. 3.3 Effectiveness and Impacts19 (Rating: ②) 3.3.1 Effectiveness

3.3.1.1 Quantitative Effects (Operation and Effect Indicators) Among the three operation and effect indicators, actual values of the two indicators (i.e.,

“afforestation area” and “quantity of planting”) excluding the survival ratio after planting reached their target values sufficiently (Table 9).

With regard to the first indicator “afforestation area”, actual values of “indicator 1-1:

afforestation area of assisted regeneration” reached the target value in 2012 in the OM Watershed, two years before the project completion, and in 2013 in the AEF Dam Upper Watershed, one year before the project completion. The achievement degree in 2016, two years after the project completion, was 133% in the OM Watershed and 147% in the AEF Dam Upper Watershed. Actual values of “Indicator 1-2 afforestation area of afforestation for protection” reached its target value in 2016 in the OM Watershed, two years after the project completion

7, 2007, the project completion was defined as “completion of the scope of work,” which was planned for December 2013. However, HCELCD did not agree on the above comparison of the project period in the ex-post evaluation, insisting on comparing the planed and actual loan disbursement periods as project completion for the reasons that the extension of the watershed conservation activities was approved in 2013 at the National Monitoring Committee attended by representatives of the JICA Morocco office to further strengthen the output level of such activities and promote the loan disbursement. 19 Sub-rating for Effectiveness is to be put with consideration of Impacts.

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and in 2013 in the AEF Dam Upper Watershed, one year before the project completion. The achievement degree in 2016 was 108% in the OM Watershed and 118% in the AEF Dam Upper Watershed.

With regard to the second indicator, “quantity of planting (seedlings),” actual values of “indicator 2-1 quantity of planting of assisted regeneration” reached the targets in 2010 in the OM Watershed and in 2012 the AEF Dam Upper Watershed. The achievement degree in 2016 was 175% in the OM Watershed and 178% in the AEF Dam Upper Watershed. Regarding the “indicator 2-2 quantity of planting of afforestation for protection,” actual values reached the targets in the OM Watershed in 2013 and in the AEF Dam Upper Watershed in 2012. The achievement degree in 2016 was 125% in the OM Watershed and 141% in the AEF Dam Upper Watershed.

As for the third indicator, “survival ratio after planting,”20 the actual value was greatly different from year to year. For instance, in the OM Watershed, the survival ratio after planting of the assisted regeneration was 3% in the lowest year, 5% as attainment degree against the target value (60%) of survival ratio of each planting yea, 87% in the highest, 145% as attainment degree against the target value (60%) of survival ratio of each planting year. The attainment degree against the target value (60%) of survival ratio of each planting year was 59% on average from 2008 to 2016. Similarly, in the AEF Dam Upper Watershed, the survival ratio after planting of the assisted regeneration was 3% in the lowest year, 5% as attainment degree against the target value (60%) of survival ratio of each planting year, 64% in the highest year, 107% as attainment degree against the target value (60%) of survival ratio of each planting year. The attainment degree against the target value (60%) of survival ratio of each planting year was 68% on average from 2008 to 2016. In the year when the survival ratio was low, external factors such as the influence of exceptional drought greatly affected the survival ratio. Evaluated comprehensively, the achievement degree was judged to be moderate. As reference information, the survival ratio for 2 years as of 2015, which combined both assisted regeneration and afforestation for protection, was 43% in the OM Watershed. In the AEF Dam Upper Watershed, the survival ratio of the assisted regeneration for more than 2 years was 37% (62% of the target) in 2014 and that of afforestation for protection was 5-75%21. This improvement was due to the fact that the survival ratio was affected by non-compliance with a grazing ban by the local population before, but it began to be observed gradually in the OM Watershed and maintenance after planting and rainfall had a positive influence on the survival ratio in the AEF Dam Upper

20 According to “Operation and Effect Indicator Reference for ODA Loan 14. Forestation, JICA”, a 5-year survival ratio after planting is said to be desirable. In Morocco, HCEFLCD collected those data 1 year after planting, and it was decided to use the survival ratio of one year after planting as an operation and effect indicator at the time of the project appraisal. Because there was no substitute indicator to replace the survival ratio of planting trees, in the ex post evaluation the data on the survival ratio of 1 year after planting of the project period was comprehensively examined. 21 Documents provided by JICA.

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Watershed in 2013-2014.

Table 9. Operation and Effect Indicators of the Project (accumulation) Target2015 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

1 year aftercompletion 2nd Year 3rd Year 4th Year 5th Year 6th Year 7th Year

CompletionYear

1 year aftercompletion

2 yearsafter

completion

3 yearsafter

completionIndicator 1 Afforestation area (ha) （accumulation)

OM Watershed 1,200 200 400 850 1,150 1,350 1,350 1,450 1,550 1,600 1,650 133%AEF Dam Upper Watershed 1,879 100 250 450 1,150 1,800 2,200 2,406 1,879 2,767 3,597 147%

Total 3,079 300 650 1,300 2,300 3,150 3,550 3,856 3,429 4,367 5,247 142%OM Watershed 2,690 270 820 870 1,390 1,890 2,390 2,610 2,710 2,910 3,010 108%

AEF Dam Upper Watershed 3,675 500 1,100 1,600 2,400 3,100 3,850 3,950 3,775 4,325 5,062 118%Total 6,365 770 1,920 2,470 3,790 4,990 6,240 6,560 6,485 7,235 8,072 114%

Indicator 2: Quantity of planting (seedlings) (accumulation)OM Watershed 288,000 70,000 148,374 298,920 425,170 505,170 505,170 551,420 591,420 611,420 175%

AEF Dam Upper Watershed 704,625 62,500 152,464 260,589 635,729 1,016,979 1,257,113 1,319,613 1,319,613 1,655,613 178%Total 992,625 132,500 300,838 559,509 1,060,899 1,522,149 1,762,283 1,871,033 1,911,033 2,267,033 178%

OM Watershed 1,344,462 136,000 495,166 526,416 931,893 1,302,493 1,675,889 1,854,849 1,914,849 2,034,849 125%AEF Dam Upper Watershed 1,836,765 401,375 849,162 1,133,090 1,585,219 2,060,569 2,598,769 2,661,269 2,715,269 3,034,450 141%

Total 3,181,227 537,375 1,344,328 1,659,506 2,517,112 3,363,062 4,274,658 4,516,118 4,630,118 5,069,299 134%

Indicator 3 Survival ratio after planting(%)

OM Watershed 60% 16% 6% 53% 3% 87% N.A. 60% 32% 27%

(Attainment degree against the

target value ）27% 10% 88% 5% 145% N.A. 100% 53% 45% 59%

AEF Dam Upper Watershed 60% 3% 64% 41% 36% 28% 29% 60% Noplantation 63%

(Attainment degree against the

target value ）5% 107% 68% 60% 47% 48% 100%

Noplantation 105% 68%

OM Watershed 60% 11% 32% 63% 3% 29% 18% 37% 65% 20%

(Attainment degree against the

target value ）18% 53% 105% 5% 48% 30% 62% 108% 33% 51%

AEF Dam Upper Watershed 60% 63% 58% 59% 36% 39% 33% 60% Noplantation 64%

(Attainment degree against the

target value ）105% 97% 98% 60% 65% 55% 100%

Noplantation 107% 86%

Attainmentdegree

(comparedto 2016)

3-2Afforestationfor protection

1-1Assistedregeneration

1-2Afforestationfor protection

2-1Assistedregeneration

3-1 Assistedregeneration

Actual

2-2Afforestationfor protection

Average of attainment degree againstthe target value

Source: HCEFLCD.

3.3.1.2 Qualitative Effects (Other Effects)

(1) Improvement of the Environment (Water and Soil Conservation by Improving Quality and Quantity of forest)

According to the interview with personnel of the executing agency and local population in the ex-post evaluation and to the documents provided by JICA, positive effects were confirmed such as the decrease in quantity of forest resource collection in most of the target rural communes after the project implementation, because the local population began to recognize the importance of forest resources and land conservation through awareness-raising activities. In the AEF Dam Upper Watershed, it was confirmed through the field survey in the ex-post evaluation that flood damage to agricultural land and livestock decreased from before due to the installation of check dams and filter fences by this project.

(2) Improvement of the Living Standard of the Local Population and Promotion of Poverty Alleviation

In the project, 28 community organizations formulated the PDUST (3-year plan) through community participation under component 5, carrying out a total of 83 activities (see Table 10).

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Table 10 shows the degree of success by activity evaluated by a consultant hired by consulting services. In the case of beekeeping and fruit trees production, in which relatively moderate and low results were observed because members did not know in the beginning how to do such activities due to lack of knowledge and experience, they succeeded after the second trial in some cases. Finally, most organizations got positive results to certain degree.

Table 10. Evaluation of Results of PDUST implementation

Good Fair Bad N.A.Apiculture 21 8 11 2 0Agricultural training 15 14 1 0 0Construction/maintenance of roads 14 9 4 1 0Fruit trees plantation (olive, almond, etc.） 12 6 6 0 0Construction/rehabilitation of water points 12 8 2 1 1Construction/rehabilitation of small-scale irrigation 6 6 0 0 0Distribution of seeds of saffron 2 1 0 1 0Improvement of lands 1 1 0 0 0

Total 83 53 24 5 1Ratio 64% 29% 6% 1%

Item Number Evaluation of Success Level

Note: The result of the PDUST implementation was qualitatively evaluated by the consultant in three stages (“good,” “fair” and “bad”). The concrete definition could not be verified in the ex post evaluation. Source: HCEFLCD.

In the interview survey conducted in the ex-post evaluation, all 28 associations stated that the living conditions improved through the implementation of the project. Details are an increase in income, a decrease in expenditure, diversification of income sources, improvement of access by construction/maintenance of roads, etc. Associations that obtained beehives and equipment for beekeeping sell harvested honey, and associations that obtained olive trees diversified their income sources by selling olive oil. As an example, beekeepers earn from 10,000 dirhams to 40,000 dirhams per association per year, and the income earned is shared among members of the association. Also, in-house consumption of harvested olives has led to a reduction in the purchase cost of olive oil, which helped improve livelihoods of the local population. Regarding beekeeping, one association in Ben Slimane Province in the OM Watershed was awarded the gold medal in the competition of domestic products in Morocco in 2014.

As mentioned above, results of the PDUST were fair to good in the most of the implemented PDUST. However, there was an association in beekeeping, which succeeded once but did not work well afterwards, and the delivered beehives were not fully utilized.

As a whole, it can be said that this project contributed to improving the living standard of the target population of the target area.

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Honey awarded a gold medal at the domestic

product competition in 2014 (OM Watershed, Ben Slimane Province)

Olive plantations managed

by a community organization (OM Watershed, Settat Province)

(3) Strengthening the Implementation Capacity of Community Associations Community associations which implemented PDUST strengthened planning and

monitoring capacities by formulating and implementing the PDUST and preparing annual reports through support of the executing agency and consultants hired by consulting services. In addition to the formulation and implementation of the PDUST, community associations conducted awareness-raising activities concerning forest conservation, such as appropriate forest resource collection and land use, for the local population, and they implement afforestation and monitoring of the use of forest resources. In this way, community associations enhanced organizational capabilities and utilize such capabilities in utilization and conservation of forest resources.

In light of the above, since the achievement level of the survival ratio, one of the operation and effect indicators used to see the degree of afforestation after planting, is fair, the effectiveness was judged to be fair.

3.3.2 Impacts

3.3.2.1 Intended Impacts (1) Conservation of Forest Resources in the Target Area 1) Decrease in Forest Resource Extraction Volume

As mentioned above, reduction of forest resource collection was confirmed as an impact of this project. The local population has no need to sell forest resources as firewood or charcoal in order to earn income because they received compensation for a grazing ban and their incomes have increased due to fruit tree production such as olives and beekeeping through implementation of the PDUST. In addition, distribution of improved stoves to the local population free of charge in the successor to this project in the AEF Dam Upper Watershed since 2015 has contributed to the decline of the need for forest resources by 50%, as well as the collection of forest resources. In the AEF Dam Upper Watershed, when comparing the situations in 2014 and 2016, the quantity of trees logged decreased by 70% and the cases of illegal logging

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decreased by 45%. Illegal logging of Himalayan cedar, which was ten plants a month before this project, decreased to one in two to three months at the time of the ex post evaluation. In Ben Slimane province in the OM Watershed, the number of grazing ban violations was 42 cases in 2016, whereas it was 13 cases in 2017. The illegal logging of raw trees has drastically decreased from 31 in 2016 to 14 in 2017.

2) Changes in Type of Collected Forest Resources Before this project, the local population in the target area was collecting all kinds of forest

resources regardless of type, such as dead trees, raw trees, etc. Through awareness-raising activities implemented by the project, they became aware of the importance of forest conservation and now they only collect olive trees planted through the PDUST and dead trees of other tree species as firewood.

3) Erosion Prevention Effect Before this project, floods caused damage to agricultural lands and livestock. In areas

where check dams and filter fences were installed by the project, such damage was no longer observed. Observing these effects, residents requested the executing agency to install check dams or fences on private lands, and check dams or fences were also installed in private lands.

3.3.2.2 Other Positive and Negative Impacts

(1) Promotion of Women’s Participation in Socioeconomic Activities In the project, socio-economists were employed in the consulting services, and at the

provincial level, several male and female “animators” were assigned to a team for awareness-raising activities in UOPS of the Provincial Direction for Water and Forest and Combating Desertification (hereinafter referred to “DPEFLCD”22). In the awareness-raising activities, viewpoints on gender were considered in collecting opinions from men and women through assignment of male and female animators in the needs survey before establishing the PDUST. The animators and DPEFLCD promoted women’s participation in implementing the PDUST. Women became members of community organizations in 16 out of 22 organizations in Sefrou Province in the AEF Upper Watershed. Table 11 shows the participation ratio of women in the associations concerned with the PDUST. Women were elected as board members23 in 15 out of the above 16 associations.

22 Direction Provinciale aux Eaux et Forêts et à la Lutte Contre la Désertification. 23 The board consists of 7 to 11 persons whose functions are: representative, deputy representative, treasurer and advisers (March 2018, interview in the AEF Dam Upper Watershed)

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Table 11. Ratio of Women in the Associations

concerned with the PDUST (case of Sefrou Province)

Ratio of women Number of associations

100% 3 50－60％ 6 20－49％ 4 3－15％ 3

0% 6 Total 22

Source: HCEFLCD.

(2) Resettlement and Land Acquisition A part of the project area of the OM Watershed was transferred to the AEF Dam Upper

Watershed because owners of the private land did not agree with the use of the private land. However, it did not cause a negative impact.

In light of the above, among the three operation and effect indicators, afforestation area and quantity of planting achieved their target values sufficiently. The actual value of survival ratio after planting was greatly different from year to year. In the year when the survival ratio after planting was low, external factors such as the influence of exceptional drought greatly affected the survival ratio after planting. In this regard, the achievement degree was judged to be fair. Positive impacts were recognized such as an increase of income and diversification of income sources brought by the livelihood improvement activities and a decrease in the quantity of forest resources collected and illegal logging as a result of change in consciousness through awareness-raising activities for the local population and livelihood improvement activities. No negative impact on the natural environment was observed and there was no resettlement. Among the operation and effect indicators, afforestation area and quantity of planting indicate the achievement result at a certain “point” whereas the survival ratio after planting indicates the degree of afforestation after a certain “period.” In this ex-post evaluation, as a result of placing importance on the achievement level of the survival ratio after planting, the effectiveness/impact was judged to be fair.

3.4 Sustainability (Rating: ③) 3.4.1 Institutional/Organizational Aspect of Operation and Maintenance (1) Institutional/Organizational Aspect of Executing Agency

The operation and maintenance of the project is carried out by the Regional Direction for Water and Forest and Combating Desertification (hereinafter referred to as “DREFLCD” 24), 24 Direction Régionale aux Eaux et Forêts et à la Lutte Contre la Désertification

20

which is a regional office of HCEFLCD and DPEFLCD.

HCEFLCD (Fig. 1) conducts planning and budget formation concerning watershed conservation in Morocco. At the time of the appraisal and during the project implementation, HCEFLCD was high commissariat directly under the prime minister. Although it became a commissariat under the Ministry of Agriculture, Fisheries, Rural Development, Water and Forests in March 2017 through the reorganization of the ministries and agencies, there was no change in position, organizational structure and role. After the reorganization of ministries and agencies, it became easier for HCEFLCD to collaborate with the agricultural sector in providing continuous technical support to agricultural components introduced by the PDUST, such as beekeeping and planting fruit tree, and in managing overgrazing, which is a major human pressure in forest conservation. Such change is a positive factor in regard to organization.

High Commissariat for Water and Forest and Combating Desertification (HCEFLCD)

Directrate of the Forest Field, Legal Affairs and Litigation

Directorate of Combating

Desertification and the protection

of nature

Directorate of Forest

Development

Center for Forest Research

Directorate of Planning,

Information System and Cooperation

Directorate of Human

Resources and Administrative

Affairs

General Secretariat

General Inspection

Source: Developed by the evaluator of the ex-post evaluation based on the documents provided by the executing agency

Figure 1 Organizational Chart of HCEFLCD

DREFLCD and DPEFLCD played a central role in project operation during the project implementation. They also currently play a pivotal role in the operation and maintenance of the project’s effect (Fig. 2). At the provincial level, the Division of Partnership for the Conservation and Development of Natural Resources was newly established in 2009, which provides compensation for the local population and follows up with agreements between the DREFLCD and the local population. In 2009, the Center for Forest Resources Conservation and Development (hereinafter referred to as “CCDRF25“) was strengthened; only one person was assigned to the CCDRF before, but after 2009, several persons have been assigned to this center. In this regard, the operation and maintenance system has been strengthened at a level closer to the local population.

25 Centre de Conservation et de Développement des Ressources Forestières

21

Regional Direction for Water and Forest and Combating Desertification (DREFLCD)

Division of Human

Resources and General Affairs

Division of Partnership for the Conservation and Development of

Natural Resources

Division of Programming, Valuation and

Evaluation

Division of Planning and

Planning Studies

Technical Center for the

Development of Hunting Resources

Wildlife Control and Monitoring

Unit

Provincial Direction for Water and Forest and Combating Desertification (DPEFLCD)

Center for Forest Resources Conservation and Development (CCDRF)

Forest Sector

Source: Developed by the evaluator of the ex-post evaluation based on the documents provided by the executing agency

Figure 2 Organizational Chart of DREFLCD and DPEFLCD

One of the achievements of the project related to the institutional and organizational

aspects of sustainability was the improvement of relations between the administration and the local population and the establishment of confidence between them. Before the project, the local population was afraid of forest guards of CCDRF, seeing them as officials who “crack down” on the local population collecting forest resources. Due to such tension, some of the target rural communes took time to organize community associations to receive compensation for grazing bans or to implement the PDUST, since it took a great deal of time to mitigate the tension the local population had toward the institutionalization. DPEFLCD and CCDRF officials patiently conducted awareness-raising activities, emphasizing dialogue between the administration and the local population, communicating the benefit of the PDUST and explaining that the appropriate use and conservation of forest resources will lead to the sustainable use of resources. As a result, the relationship between the local population and the administration changed from “tense” to “trusting.” Officials of DPEFLCD who were engaged in implementation of this project acquired communication skills in the participatory approach training organized by the consultant that was engaged in technical assistance and utilized the acquired skills in dialogue with the local population. Currently, the local population cooperates in afforestation and reporting illegal logging to forest guards. Members of this population ask forest guards to construct or rehabilitate mountainous/forestry access roads and to distribute beehive boxes and improved stoves. Such behaviors were not observed before the project. This trust-based relationship is maintained, even at the time of the ex-post evaluation, which is a factor that ensures the institutional/organizational aspect of sustainability.

(2) Institutional/Organizational Aspect at the Community Level

Most community associations formed for the implementation of the PDUST are maintained

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and functioning well; observing the grazing ban zones, they continue activities introduced by the project such as beekeeping, planting fruit trees and maintain constructed/rehabilitated rural roads, water sources and irrigation canals. These associations continue awareness-raising activities for the local population. In the OM Watershed, the local population did not agree with organizing associations receiving compensation for grazing bans; the association was not organized and compensation was not paid. However, the effect of raising awareness at the community level has been gradually recognized. As stated below, after the law on grazing was established in 2016, illegal logging cases declined. It was judged that any community association that was not organized in the OM Watershed has not negatively influenced the sustainability of the project’s effect. (3) Enhancement of the Management of Overgrazing in the Legal System

As stated in 3.1.1, the pressure on forest resources due to overgrazing was a problem nationwide and in the project target area. In March 2016, the law on the movement for grazing on and the use and maintenance of grazing lands was enacted. This law established the basic principles and general rules for the improvement of grazing and cultivated lands, for the use and development of grazing lands and resources, for the movement across grazing lands and for the movement of livestock.

In the OM Watershed, when awareness-raising activities started in 2009, the local population did not agree with the organizing associations receiving compensation for grazing bans. No associations were thus formed, and compensation was not paid. However, as stated in 3.3.2.1 Intended Impacts, the amount of illegal grazing and logging of raw trees in the grazing-prohibited areas in Ben Slimane Province has drastically decreased from 2016 to 2017 after the law was established. Although it is a little premature to verify the effect of the law’s establishment, institutional strengthening in the legal system is a positive factor in the sustainability of institutions and organizations, as well as changes in the awareness of the local population.

3.4.2 Technical Aspects of Operation and Maintenance (1) Administration Level

DREFLCD and DPEFLCD, which are responsible for the operation and maintenance of the project’s outputs (reconstruction of degraded forest ecosystem, improvement of grazing and cultivated lands, treatment of lands affected by rill and gully erosion, improvement of forest infrastructure, etc.), conduct monitoring and take necessary measures after planting (reforestation in cases where the survival ratio is below 60%), conduct maintenance for installed structures and take necessary measures for problems reported by the local population in the jurisdiction area without delay. In this regard, there is no technical problem. In addition,

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DREFLCD officials are still using the skills acquired through GIS training implemented by this

project for formulating plans. Furthermore, skills for communicating with the local population, which were acquired in the training attended by officials of DPEFLCD as part of a participatory approach, as mentioned above, are utilized in the implementation of the PDUST and awareness-raising activities for the local population in the successor projects.

(2) Community Level

Effects of the project brought by the PDUST, such as beekeeping, planting fruit trees, constructing and rehabilitating rural roads and water sources and so on, are well maintained by community associations.

On the other hand, associations conducting beekeeping and producing olives wish to acquire further knowledge and skills to improve income and to sustain their activities and facilities, such as the irrigation facilities necessary for maintaining planted trees. Since these requests include those exceeding the function of HCEFLCD, cooperation with the departments concerned with the Ministry of Agriculture, Fisheries, Rural Development, Water and Forests is desirable in the future. In the interview with DREFLCD and DPEFLCD at the time of the ex-post evaluation, it was confirmed that information sharing was done as collaboration with the agricultural sector; however, collaboration at a level closer to the local population is desired. For instance, it is required for CCDRF forest guards closest to the local population to transfer the CCDRF’s requests or any problems the guards notice during their periodical inspection in the forest to the agricultural sector (e.g., beekeeping, which was once successful, has not been maintained after its initial success).

3.4.3 Financial Aspects of Operation and Maintenance

Table 12 shows the budget of HCEFLCD, and Table 13 shows the budget of the DREFLCD. HCEFLCD formulated a ten-year program and a detailed three-year program, which is based on the ten-year program. The budget has been increasing since 2015, and the budget for maintenance is ensured to be about 6% of the total budget every year. The budget for operation and maintenance has never been short in HCEFLCD. DREFLCD formulates an annual plan based on the three-year program, and the budget has been allocated based on the annual plan; so far, there has been no shortage. The Government of Morocco has allocated its own budget for successor projects since 2015 in both target watersheds.

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Table 12. HCEFLCD Budget Unit: Million dirham

Total budget Budget for operation and maintenance

2006 702.7 17.2 2007 702.1 10.6 2008 812.4 41.0 2009 983.4 41.0 2010 1001.4 41.0 2011 1088.0 40.0 2012 1071.8 42.8 2013 935.0 45.0 2014 1008.0 45.0 2015 1134.0 73.0 2016 1168.2 76.2 2017 1191.2 76.2

Source: HCEFLCD.

Table 13. DREFLCD Budget Unit: Million dirham

Note: The above data show the result of the budget for the operation and maintenance of all areas, including the project’s target area, covered by the DREFLCD. Source: HCEFLCD.

As described in the next section, “3.5.4 Status of operation and maintenance,” related infrastructures, such as forests and structures, are well managed and maintained. The operation and maintenance budget is stable, since the government of Morocco has been implementing the successor projects using its own budget since 2015, the year following the completion of the project.

3.4.4 Status of Operation and Maintenance

The status of the project’s output has been further strengthened after the project’s

Center Region Fès Boulemane Region

Total budget

Budget for operation and maintenance Total budget Budget for operation

and maintenance 2006 42.1 2.2 29.7 2.2 2007 38.6 2.0 31.6 1.5 2008 58.5 6.6 41.2 1.7 2009 83.8 3.3 49.5 1.8 2010 54.0 2.1 52.5 1.4 2011 69.6 2.5 62.0 2.3 2012 77.1 2.0 64.5 2.3 2013 68.9 2.6 44.8 2.6 2014 65.3 2.6 44.8 2.6 2015 40.8 3.7 43.0 2.6 2016 33.5 1.9 48.4 2.3 2017 34.7 2.2 42.7 2.3

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completion, as described in the results of each component. In particular, the actual result of the afforestation area and the amount of planting due to the assisted regeneration and afforestation for protection (Table 9), as well as planting fruit trees and regenerating natural grazing lands, have continuously increased since the government of Morocco began implementing successor projects with the same components as this project with its own budget since 2015. Other effects are also maintained and managed in the successor projects. Also, the equipment provided by component 6 is well maintained without any problems.

In light of the above, no major problems have been observed in the institutional, technical, financial aspects and current status of the operation and maintenance system. Therefore, sustainability of the project effects is high. 4. Conclusion, Lessons Learned and Recommendations

4.1 Conclusion The objective of this project was to restore degraded lands and improve the livelihood of

the local population by carrying out afforestation and livelihood activities in OM Watershed in the regions of Chaouia Ourdigha and AEF Dam Upper Watershed in the region of Fès-Boulemane, thereby contributing to natural resources conservation and to poverty alleviation of the local population in the above two regions.

The project has been highly relevant to the development plan and development needs of Morocco, as well as Japan’s ODA policy; therefore its relevance is high. Among the three operation and effect indicators, those of afforestation area and quantity of planting achieved their target values sufficiently. The actual value of the survival ratio after planting was greatly different from year to year. In the year when the survival ratio after planting was low, external factors such as the influence of exceptional drought greatly affected the survival ratio after planting. In this regard, the achievement degree was judged to be fair. Positive impacts were recognized such as an increase in income and diversification of income sources brought by the livelihood improvement activities and a decrease in the quantity of forest resources collected and illegal logging as a result of change in consciousness through awareness-raising activities for the local population and livelihood improvement activities. No negative impact on the natural environment was observed and there was no resettlement. Among the operation and effect indicators, those of afforestation area and quantity of planting indicate the achievement result at a certain “point” whereas the survival ratio after planting indicates the degree of afforestation after a certain “period.” In this ex-post evaluation, as a result of placing importance on the survival ratio after planting, the effectiveness/impact was judged to be fair. Although the project cost was within the plan, the project period slightly exceeded the plan; therefore the efficiency of the project is fair. In sustainability, with regard to the institutional/organizational

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aspects, the organizational structure of the executing agency, the HCEFLCD is maintained at central, regional and provincial levels from the appraisal to the ex-post evaluation. In technical aspects, the executing agency conducts monitoring after afforestation, and maintenance of check dams and filter fences without problems. There is no problem in financial aspects. Therefore, sustainability of the project effects is high.

In light of the above, this project is evaluated to be satisfactory. 4.2 Recommendations

4.2.1 Recommendations for the Executing Agency (1) Continuous Support for the Local Population to Strengthen Compliance with Grazing Bans

Community associations that receive compensation for grazing bans were not formed due to the disagreement of the local population, and no compensation was paid in the OM Watershed. The effects of awareness-raising activities for the local population that were organized by the project are gradually being recognized, and illegal grazing and logging in the grazing-prohibited area have decreased since the law’s establishment in 2016 clearly defines the grazing method. Although such effects are positive factors for the sustainability of the project’s effects, it is recommended that DREFLCD and DPEFLCD (including CCDRF) in the OM Watershed intensively and periodically visit communes where such an agreement was not obtained by collaborating with officials of other administrative sectors. Then, it is recommended for DREFLCD and DPEFLCD to continue an open dialogue with the local population and to conduct awareness-raising activities with view to thoroughly informing locals about the law. It is recommended for them to monitoring for illegal grazing and logging, ensuring that grazing bans are observed in the entire target area.

4.3 Lessons Learned (1) Increased Frequency of Reviewing Operations and Effect Indicators

The operation and effect indicators of the project were set for a target year of 2015 at the time of the appraisal, and they were revised at the time of the mid-term review in 2011. Despite the fact that the operation and effect indicators on the afforestation area and the amount of planting reached their target values in the OM Watershed in 2012 and in the AEF Dam Upper Watershed in 2013, their target values were not revised. In addition, when the one-year extension for watershed conservation activities was moved from December 2013 to December 2014, a revision of the target values to be achieved two years after the project completion year (2016) was not conducted. Since it was difficult to assume target values from interviews with concerned parties or information obtained from existing documents in this ex-post evaluation, and because there were no alternative data, the target values revised in 2011 and targeted for 2013 and the actual result at the time of the project completion (2014) were compared when

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evaluating “efficiency.” In evaluating “effectiveness,” the target values revised in 2011, for which the target year was 2015, and the actual result as of 2016 were compared. Based on the interviews with concerned parties at the time of the ex-post evaluation, it is assumed that the indicators were not revised because concerned parties, who were members of the national monitoring committee of the project, such as the executing agency JICA, did not fully recognize the necessity of revising the target values based on the monitoring result.

Given that the indicators reached the target value before the target year and that the period for the project activities was extended, JICA and the executing agency should have revised the target values when the indicators were achieved or when the extension of the period for the project activities was decided to continue pushing project activities toward the clear targets. As for future project management, it is desirable that JICA and the executing agencies monitor the achievement status of the indicators, not only at the time of the mid-term review but once a year and at the time of the project completion review. They should also revise the indicator as necessary by making a prospect of the achievement of the indicators for the target year.

(2) Clarification of the Definition of Indicators and the Method of Their Measuring at the Planning Stage and Project Commencement

In this project, the survival ratio after planting, which was one of the operation and effect indicators, was targeted for the survival ratio of one year after planting. According to the JICA’s operation/effect indicator guideline (afforestation), the survival ratio after planting can be appropriately evaluated by examining the survival ratio for a certain period. Regarding the indicators necessary to verification from a mid- and long-term perspective, it is desirable to discuss the monitoring method that can verify the project’s effect at the time of appraisal, confirming the usual monitoring method of the executing agency. During the project’s implementation, it is better for JICA and the executing agencies to collaborate to analyze the indicators’ achievement status in anticipation of the ex-post evaluation.

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Comparison of the Original and Actual Scope of the Project Item Plan Actual

1. Project Outputs (1) Watershed Conservation Activities 1) Reconstruction of Degraded Forest Ecosystem (afforestation, tending of plantation, thinning and installation of fences, etc.) 2) Grazing and Cultivated Lands Improvement (slyvopastoral plantations, installation of fences and fruit tress plantation, etc.) 3) Treatment of Lands Affected by Rill and Gully Erosion (Installation, maintenance and rehabilitation of check dams and filter fences) 4) Forest Infrastructure Improvement

Nurseries improvement Construction/maintenance of forest road

Maintenance of forest firebreaks Construction/maintenance of forest offices

5) Local Population Livelihood Improvement 6) Equipment for Institutional Strengthening

Vehicles and trucks Computers

Computer related software equipment audio-visual equipment

(2) Consulting Services

Overall Project Management Monitoring and Evaluation of the

Project (Mid-Term Review and Review at the time of Project Completion)

Training Program for the Executing Agency (participatory approach, GIS)

A total of 59,500ha A total of 13,470ha 38,500㎥ 4 sites 312 km 53,000 ha 40 offices 22 PDUST 21 units 37 units 3 sets 20 sets International consultant: 11 M/M National consultant:21M/M Animators: 906 M/M

A total of 80,758ha A total of 11,293ha 62,786㎥ 5 sites 381 km 21,400ha 53 offices 28 PDUST As planned International consultant: 5.82 M/M National consultant:12 M/M Animators: 472 M/M

2. Project Period

March 2007 – December 2013

(82 months)

March 2007 – December 2014

(94 months) 3. Project Cost Amount Paid in Foreign Currency

44 million yen

15 million yen

Amount Paid in Local Currency 4,178 million yen 2,234 million yen (311 million Moroccan

dirham) (201 million Moroccan

dirham) Total 4,222 million yen 2,249 million yen ODA Loan Portion 3,165 million yen 1,793 million yen Exchange Rate 1 MAD = 13.4 yen

(As of December 2006) 1 MAD = 11.1 yen

(Average 2009 and 2017) 4. Final Disbursement November 2015